After exiting Chapter 11 bankruptcy protection in November, the 118-year-old retail giant JCPenney plans to restart in 2021, starting with the search for a new leader.
As new owners reshape retailers, JCPENNEY will close more stores in 2021
The retailer’s new owners, Brookfield Partners and Simon Property Group, announced that they are looking for “focused on modern retail, consumer experience and the goal of creating a sustainable and enduring JCPenney” people. The search will be conducted in cooperation with Authentic Brands Group.
|BPY||Brookfield Real Estate Partners||1
|SPG||Simon Property Group Co., Ltd.||83.97||+0.68||+ 0.82%|
JC Penney’s current CEO Jill Soltau is scheduled to leave the company on Thursday. According to the company, after serving as President and CEO of JOANN Stores, a retailer of fabrics and handicrafts, and President of Shopko Stores, Soltau joined JC Penney’s leadership team in October 2018. Soltau’s appointment caused the company’s stock to soar at the time, and it is hoped that she can help the company to reverse the situation.
At the same time, Stanley Shashoua, chief investment officer of Simon Property Group, will take over as interim CEO, effective January 1, 2021.
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As the coronavirus pandemic swept the retail industry, JC Penney filed for bankruptcy in May. The company’s financial woes led to the closure of 154 stores in 38 states in June, the closure of 152 stores in July and the layoff of 1,000 employees.
JC Penney said in September that it had reached a bailout agreement in principle with Simon and Brookfield, worth US$800 million in cash and new loan debt. The transaction was approved by the Bankruptcy Court for the Southern District of Texas in November.
As part of the transaction, Simon and Brookfield will own 160 real estate assets of JCPenney and all of its own distribution centers as part of an independent real estate holding company. Kirkland & Ellis’ bankruptcy lawyer Joshua Sussberg said at a hearing in September that the bailout agreement would save approximately 70,000 jobs.
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In addition to searching for the CEO, the department store chain also plans to close other stores in March.
In a statement to USA Today, JCPenney said: “As part of the store optimization strategy that began with the financial reorganization in June, we have decided to close another 15 stores.” These stores will begin liquidation later this month. Sales and will be closed to the public in mid-to-late March. “
Overall, the company’s two-year restructuring will permanently close nearly one-third of its 846 stores, leaving it with only more than 600 stores.