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J.C. Penney has been in conversations with its banks in recent weeks about their liquidity needs, and has been in on-and-off negotiations with lenders about a possible debt deal, said the people, who are not authorized to speak publicly and asked not to be named discussing private information.
The firm joins a roster of advisers helping J.C. Penney navigate its obstacles. The retailer is also working with restructuring advisers from the law firm Kirkland & Ellis LLP and investment bank Lazard Ltd., Bloomberg previously reported. A representative for J.C. Penney declined to comment on the latest hire.
Retailers still do the bulk of their business at their physical locations. The lockdown now in effect to prevent the spread of the coronavirus puts retailers at risk of missing an entire season or more of business. That may leave them holding merchandise that has dropped in value.
Last month, J.C. Penney disclosed that it ended talks with one creditor after failing to reach an agreement but would continue discussions about its capital structure. The company also drew $1.25 billion of its $2.35 billion revolving credit line to shore up financing during coronavirus-related market upheavals.
A solution is critical for the beleaguered department-store chain, which said it was extending its temporary store and office closings and furloughing most store workers as it fights to conserve cash. The chain added that it is “evaluating other financial options.”
©2020 Bloomberg L.P.
