PLANO, Texas — JCPenney has sold its interest in Simon Property Group, L.P. back to Simon Property Group Inc. for $248 million in cash, helping the company get back on financial track.
"Last year, as we began our journey to transform JCPenney, we determined it was necessary to review and, where appropriate, monetize assets that are not core to our operations," said CFO Ken Hannah. "Today's announcement represents the first step toward executing this plan. In addition, converting this non-core asset into $248 million of cash enhances the Company's already strong balance sheet and liquidity."
Following the transaction, JCP Realty Inc., a wholly-owned subsidiary of jcpenney, continues to hold approximately 205,000 limited partnership units in Simon's operating partnership. J.P. Morgan Securities LLC acted as an advisor for this transaction.
Also on Monday, JCPenney CEO Ron Johnson unveiled a trio of in-store shops, slated to open at 683 JCPenney stores across the United States starting on Aug. 1.
The three in-store concepts all feature denim offerings. Another lineup of shops is slated to open on Sept. 1.
For its first quarter, JCPenney reported an adjusted net loss of $55 million or 25 cents per share. Comparable-store sales for the first quarter declined 18.9%.