For JC Penney CEO, Debt Haunts Turnaround Bid

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For JC Penney CEO, Debt Haunts Turnaround Bid

That is the rough total of the potentially crushing personal debt load on Penney’s balance sheet, a ticking time bomb that could derail Soltau’s try to revitalize the 117-year-old department store string. Soltau, 12 months from build and materials seller Jo-Ann Stores hired later last, is attempting to restore Penney’s root base as a store of mid-priced apparel for middle-class families.

In the short term, she is reducing inventory at stores to improve margins on shutting and merchandise underperforming retailers. 1.75 billion in liquidity in the form of cash and money available under a revolving credit line, a point Soltau has emphasized in meetings with hedge money keeping the retailer’s loans and bonds, a person acquainted with the matter said.

That makes Penney’s near-term debts payments manageable. 2 billion comes due in 2023, the legacy of a loan tapped six years back after Penney changed former CEO Ron Johnson. The onetime pioneer of Apple’s shops launched expensive renovations of Penney stores and eliminated coupons, sparking a person backlash that led to plunging sales.

The result is Penney employed advisers to explore debt restructuring options that could buy more time to forge a turnaround, In July Reuters reported. Penney subsequently confirmed hiring advisers to boost its balance sheet after investors dumped its shares, and added it was not making bankruptcy preparations. Levi Strauss Chief Executive Officer Chip Bergh within an interview. Bergh has urged Penney to stock more of his company’s denim and buy less from poorer selling brands. Penney’s latest personal debt advisers include restructuring specialists from lawyer Kirkland & Ellis and investment bank or investment company Lazard, according to the people acquainted with the hires.

The firms, which acquired no comment, been employed by on significant workout routines with other merchants, including on a debt restructuring previously this season for luxury clothier Neiman Marcus Group performed with no need for a personal bankruptcy filing. The advisers are not exploring bankrupties processing for Penney and are focused on reworking finances outside of court proceedings, one of the resources said. Penney took similar steps in 2013, leading to a new loan it offers refinanced to come due in four years. Levi’s Bergh said Penney is a “long way away” from suffering the fate of Sears, year which submitted for bankruptcy last.

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At once, I had been chief and president working official of Primerica, so I just kept accumulating responsibilities. I knew I possibly could run companies. I had been doing that. And I didn’t expect Sandy to visit anywhere. I loved what I was doing. Euromoney Who had been the main influences on your job?