JC Penney has spurned a bankruptcy financing package that was reportedly being put together by a consortium of Wall Street banks and is instead running right back into the arms of private equity for $500 million in cash plus a handful of other perks.
Bloomberg reports JC Penney is negotiating a bankruptcy loan with KKR & Co., Ares, Sixth Street Partners & Apollo. According to details reported by BBG, the deal would leave Penney with $500M in cash and a slashed debt burden in exchange for control of the company, which will remain in operation.
The plan will reportedly be included in the department store's bankruptcy filing, which should arrive as soon as next week. This latest development in JCP's bankruptcy saga - one of an expected wave of bankruptcies as the massive pile of junk-rated or just-above-junk debt rattling around the economy sparks a massive reckoning, something Sam Zell says is a painful but necessary stop on the way back.
Yesterday, we reported that Neiman Marcus was filing (it officially filed just a few hours ago).
And the list grows thinner...