May 18 (UPI) — Big-box retailer JC Penney will close almost one-third of its U.S. store locations as part of a Chapter 11 bankruptcy restructuring plan that the company hopes will avoid an all-out liquidation of assets, a filing document said.
The long-troubled 118-year-old retailer will closes 242 locations, or about 29 percent of its 846 stores, according to a “Plan for Renewal” slideshow filed Monday with the Securities and Exchange Commission.
The document did not specify which locations would close, but said stores would close in weaker U.S. malls. The remaining stores would be located in the U.S. midwest, south and southeast, the Plano, Texas,-based company said.
“The approximately 604 future fleet represent the highest sales-generating, most profitable, and most productive stores in the network,” the company said in the SEC filing.
Years of poor sales were made worse by the coronavirus pandemic that has shuttered its stores for weeks, the company said. The national lockdown added to the stress of years of falling profits at the company, which admitted it has failed to connect with customers online and in retail stores.
“We realize the world has changed,” the presentation said.
In an earlier SEC filing, JC Penney said its current financial status is at “known and unknown risk” partly due to the coronavirus pandemic, and is “out of the company’s control.”
The chain said it would be reopening about 115 stores after the pandemic, USA Today reported. More than 40 locations have already reopened, JC Penney spokesperson Brooke Buchanan said Monday.
On Friday, the company announced it had secured $900 million in debtor-in-possession financing that would allow the chain to remain open while it works its way through bankruptcy.