Web giant Amazon.com or major mall owners may buy all or part of bankrupt J.C. Penney, according to a report in WWD, which cited unnamed sources.
J.C. Penney filed for Chapter 11 on Friday, blaming fallout from the COVID-19 pandemic, which forced the temporary closure of all its stores.
The department store chain has said that it plans to stay in business and entered Chapter 11 with a restructuring plan supported by its first-lien lenders. The plan calls for the company to close 242 of its 846 stores, or about 29% of its current fleet.
It has also said that it is exploring selling itself to a third party.
A “source who does business” with Amazon told WWD the online e-tailer currently has a team in Plano, Texas, where J.C. Penney is headquartered.
“There is a dialogue, and I’m told it has a lot to do with Amazon eager to expand its apparel business,” the source told the publication.
The source speculated that Amazon might convert the Penney locations into its new checkout-free retail format, which it said would be uniquely suited to the new socially distanced world.
It could also convert the Penney stores into distribution centers for its e-tail sales, it said.
“Penney’s has about 30 freestanding locations with a lot of land, which could be converted,” the source told WWD. “They do have some good real estate.”
Amazon could not be reached for comment, but declined comment to WWD.
The publication also reported that several mall developers, including the Simon Property Group and Brookfield, are considering buying the department store.
“They don’t want to see Penney’s go dark permanently because of the negative ripple effect it would have in their shopping centers,” the publication said.
In 2017, Amazon purchased grocer Whole Foods for $13.7 billion, in one of its first forays into brick-and-mortar retail.
(Image courtesy of J.C. Penney)
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