Brookfield Property Group, Simon Property Group Agree to Acquire JCPenney for $1.75 Billion

Plano, Texas — Brookfield Property Group and Simon Property Group have agreed to acquire the retail and operating assets of J.C. Penney Co. for $1.75 billion at a bankruptcy auction.

As part of the sale agreement, the three companies will form a property holding company (PropCos), which will include 161 of the J.C. Penney real estate assets and all of its owned distribution centers. The Plano, Texas-based retailer’s Ad Hoc Group of First Lien Lenders will own PropCos.

J.C. Penney filed for Chapter 11 bankruptcy in mid-May and restructured 90% of its debt with its lenders. Brookfield and Simon enter into the bankruptcy auction as the stalking-horse bidders. The retailer expects the auction to close before the 2020 holiday season.

“As we continue to move through the sale process, our focus will remain on serving our customers and working seamlessly with our vendor partners,” says Jill Soltau, CEO of J.C. Penney. “We have been a trusted partner to all of our stakeholders since 1902, and we expect to continue that track record for decades to come under the J.C. Penney banner.”

The auction is being held through the U.S. Bankruptcy Court for the Southern District of Texas.

During its second-quarter earnings call, Indianapolis-based Simon said it would focus on acquiring distressed retailers. Simon and Authentic Groups Brand formed Sparc Group to acquire two clothing retailers — Brooks Brothers and Lucky Brand — out of bankruptcy earlier this year.

 

— Alex Tostado

 

classic-editor-remember:
classic-editor
abkw-text:
Tagged under