JCPenney Files for Chapter 11 Bankruptcy
Some locations may permanently close.
Add JCPenney to the list of retailers filing for bankruptcy. After Neiman Marcus and J.Crew made the move in the past few weeks, USA Today reports that JCPenney filed for Chapter 11 bankruptcy protection today and plans on permanently closing select locations.
JCPenney has not been profitable since 2010, CNN reports. More recently, the company "racked up an unsustainable amount of debt" and in order to survive bankruptcy, the chain will close an unspecified number of stores from its portfolio of 845 locations. Moody's Investor Service reports that JCPenney has $4.2 billion in debt, though CNN has the number at $3.6 billion.
In a statement, JCPenney said that it has "secured support from some of its financial creditors" and has set plans to eliminate debt. The strategy needs to be approved by a bankruptcy judge, however, and the judge could choose instead to force the retailer to shutter completely if that's a better option for creditors.
"Implementing this financial restructuring plan through a court-supervised process is the best path to ensure that JCPenney will build on its over 100-year history to serve our customers for decades to come," CEO Jill Soltau said in the statement.
JCPenney is 118 years old. Since 2011, the chain has closed 20% of its stores and had announced store closures as recently as February 2020, before the coronavirus pandemic closed most of its locations. USA Today notes that the store's heyday was in the '80s and that the store made appearances in movies such as Back to the Future and the Netflix series Stranger Things.