In the growing list of retailers struggling with issues of liquidity, JCPenney has emerged as another brand hit hard as its fleet of around 850 stores remain closed due to COVID-19 lockdown.
The retailer has turned to consultancy firm AlixPartners LLP to help manage a heavy debt load of almost US $ 4 billion, as reported by Bloomberg.
Not only this, the company has also been in talks with its banks about its liquidity needs and is engaged in negotiations with lenders for a potential debt agreement.
After furloughing most of its workforce of 90,000+ employees, the company had withdrawn US $ 1.25 million from its revolving credit line to meet cash needs.
Only last year, JCPenney had held discussions with lawyers and investment bankers to come up with possible avenues of debt restructuring as the company aimed to affect a turnaround. JCPenney’s online business remains active.
The retailer’s sales fell 8 per cent to US $ 10.72 billion in 2019 as compared to the previous year.
Macy’s had also reported recently that it had turned to investment bank Lazard to help manage liabilities and explore options to bolster its financial structure. As Chairman and CEO of Macy’s, Jeff Gennette is forgoing is salary, they have also had to furlough most of their 120,000 employees in the wake of the pandemic.
Also Read: Macy’s hires Lazard for options to shore up finances during COVID-19 lockdown
