The clock is ticking for J.C. Penney Co., which is racing to settle with collectors rapidly sufficient to persuade them it might as soon as once more generate profits promoting clothes, cosmetics and cookware to a different technology of Individuals.
After filing for chapter 11 protection Friday, Penney appeared on Saturday within the U.S. Chapter Court docket in Corpus Christi, Texas, the place the department-store chain hopes to slash its debt, spin off a real-estate division and place itself to welcome again consumers as many states loosen their stay-at-home restrictions.
The longer Penney stays mired in chapter, the much less doubtless it can emerge from chapter 11 as a unbroken enterprise, based on legal professionals representing the corporate and its lenders. Retailers and supermarkets that file for chapter are extra doubtless than different kinds of corporations to easily liquidate reasonably than restructure as viable companies.
Penney has taken steps to keep away from that destiny, negotiating for as a lot as $900 million in chapter financing to maintain itself afloat and setting an aggressive restructuring timetable, the corporate’s chapter lawyer Joshua Sussberg stated on the listening to. Half of the proposed financing, which requires courtroom approval, would supply contemporary capital, whereas the opposite half pays down current debt.