J.C. Penney: $1.75B Loan Taken From Goldman Sachs

    April 29, 2013
    Sean Patterson
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In early April, J.C. Penny CEO Ron Johnson stepped down following over one year of dismal financial results at the company. Johnson had attempted to turn the department store business on its head, eschewing sales and coupons in favor of consistently lower pricing, but the company’s board was forced to make changes due to a plummeting stock price and an estimated $3.5 billion debt.

It seems, however, that not everyone has written off J.C. Penney. Investment bank Goldman Sachs has issued a five-year $1.75 billion loan to the troubled department store. J.C. Penney stated that the funds will be used to fund “ongoing working capital requirements,” “general corproate purposes,” and part of its debt. The loan is secured by real estate and interest in J.C. Penney.

“This loan facility is an important component of our strategic plan to strengthen the Company’s financial position,” said Ken Hannah, CFO of J.C. Penney. “Together with our revolving credit facility, this will give us the financial strength we need to meet our current funding requirements and build toward a successful future.”

This loan is in addition to the $850 million that J.C. Penny borrowed from a revolving credit fund two weeks ago. The company stated that loan would go toward ensuring the company’s liquidity and to replenish inventory at its stores.

  • Avis Tripp

    I’m a long-time shopper of JCP and was very disappointed when Ron Johnson took over my favorite store. He ruined it as far as I’m concerned. I loved JCP just the way it was. I had practically decorated my whole house with their great sales. I never went in that store that I didn’t come out with something for myself or my home. Now I never go in the store after visiting it a few times post Ron Johnson. The Liz Claiborne line is horrible. Whatever happened
    to all those beautiful clothes she used to sell? Since she died all the gorgeous classic sweaters, pants and jackets have disappeared. I have never bought one item of hers in JCP or anything else for that matter.
    Sign me a very sad and frustrated former customer.
    Avis Tripp

    • http://yahoo.com kpoteet@ford.com

      I agree 100%, he ruined that store. I used to buy 90% of my clothes there, I have not bought one thing since they changed the store. Everything is junky. Now I buy on e-bay. It was not so much doing away with the coupons that did it for me, just the store turned into a K-Mart or Target or something close.

    • Marilyn E. Torain

      I must agree with Avis Tripp. I am not a shopper, however, when I felt the need to replace a garment or buy shoes I would go to JC Penney. Since I don’t shop often, I was in the store approximately six months ago. Like Ms. Tripp, I would purchase several items at one time. Going to the two departments I frequented the most, I was very disappointed that I could not find anything worth my shopping dollars and/or taste. Walking through the store and checking out other departments, I found that the once coveted items people purchased, were no longer being offered and the racks, counters and floor samples of items looked cheap and junkie… there is nothing in the store that appealed, not only to me but to many other shoppers in the store that day. I have not returned to JC Penney and I doubt if I ever will. Sad comment to a once classic establishment.

  • http://webpronews.comYahoo A. Tinker

    I love Alfred Dunner clothes, and bought three and four outfits each time I visited JCP stores in different states when we traveled. These clothes always fit perfectly, with not having to try them on before I buy. Now the colors are so dark, (for summer? and there is very little variety available to choose from, in JCP stores even as I see in the Atlanta area etc. In Ohio, I see the same dark similar styled fashions offered by A. Dunner? There is not many selections of other name brands to choose from either, as far as styling and colors? Is JCP buying a cheaper quality of these brands, or do they need a new Fashion Mgr. or buyer, for the older ladies, or for those who need larger sizes now? I have not been able to purchase any items my last two visits to JCP. Not every store carries this brand of clothes that I see many women choose, and have bought for many years now? If this continues, I will not bother to shop JCP any longer. My children were raised on JCP clothes, and continued to purchase a lot of home items in these stores until lately. The Jan. JCP WHITE Sales, were great!! I am very disappointed, and sorry this is happening.