Recent rumors about bankrupt department store company J.C. Penney (OTC:JCPN.Q) merging and disappearing if it is bought out by private equity firm Sycamore Partners were countered today by Joshua Sussberg, a lawyer for the retailer.
Speaking in court, Sussberg rejected the idea that any of the potential purchasers planned to combine J.C. Penney with another company and thus extinguish its brand name. All of the bidders, left unnamed for confidentiality reasons, mean to run the retailer as a stand-alone department store after buying it and getting it out of bankruptcy, he said.
Sussberg also said that liquidation of J.C. Penney "is simply not in the cards" and that those running the company "have had not one discussion with our lenders or any other stakeholders about a liquidation." He dismissed specifics about bidders and bid amounts published in The New York Post and elsewhere earlier this week as "ill-informed," with the names of the possible purchasers and their offers undisclosed as of Thursday evening.
While Sussberg's comments mostly expressed confidence that J.C. Penney will emerge successfully from bankruptcy in late 2020, he said selling the retailer to a new owner "needs to move faster" to achieve the desired results. Penney's cash reserves currently stand at $1.2 billion but are more than counterbalanced by the company's long-term debt total of $3.8 billion.