A proposed $947 million deal to sell 117 JCPenney stores is on the verge of collapse following a missed deadline by a private equity firm. The transaction, which was first announced in July, involved Onyx Partners, Ltd. acquiring over 100 properties from Copper Property CTL Pass Through Trust, a trust established by the retailer’s lenders after its bankruptcy in 2020. According to a regulatory filing submitted on December 22, 2023, the trust indicated that the sale “did not close” and has issued a termination notice to Onyx.
The agreement was initially set to finalize in early September but faced multiple delays. The failure to complete the transaction means that the funds from the sale, intended to benefit JCPenney’s creditors, remain in limbo. JCPenney, which operates nearly 650 stores across the United States, emerged from Chapter 11 bankruptcy in December 2020, having undergone significant restructuring.
Potential Impact on JCPenney Stores
While the trust has made it clear that the deal will be terminated unless Onyx completes the purchase by the end of the week, the implications for the stores involved remain uncertain. When the sale was first announced, JCPenney confirmed that all locations included in the transaction would continue to operate. The stores slated for sale are spread across 35 states and include 19 locations in Texas and 19 in California, as well as one location in Puerto Rico.
As the retail landscape continues to evolve, the fate of these stores hangs in the balance. Earlier this year, JCPenney also announced the closure of seven stores nationwide, indicating ongoing challenges for the brand. The outcome of this potential sale could have lasting effects on the company’s operational strategy and financial recovery.
With the deadline approaching, stakeholders will be watching closely to see if Onyx can meet the terms of the agreement or if JCPenney will need to reassess its approach to managing its store portfolio moving forward. As the situation develops, the broader implications for JCPenney and its creditors will become clearer, highlighting the ongoing complexities in the retail sector.
