JCPenney Prepares To File For Bankruptcy

Read more on this subject: Business/ Commerce
News Story Source: https://www.zerohedge.com, by Tyler Durden
According to the Journal, J.C. Penney is in advanced talks for bankruptcy funding with a group of lenders, a sign the troubled retailer about to make a visit to 1 Bowling Green. JCP is in discussions with existing lenders including Wells Fargo, Bank of America and JPMorgan for a debtor-in-possession loan that would keep the department-store chain's operations funded during a court-supervised bankruptcy, according to people familiar with the matter.

The DIP loan would be roughly $800 million to $1 billion, with some of that money potentially including existing debt, and priming all the other unsecured creditors who will end up with a chunk of the post-petition equity, assuming of course it is not a Chapter 7. 

The Journal sources said that a bankruptcy filing could take place within the next few weeks, and certainly before May 15 as JCP entered into a 30-day grace period after missing an interest payment due to bondholders on April 15. It is possible creditors enter into
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