J.C. Penney reportedly exploring filing for bankruptcy protection

With its 850 U.S. stores temporarily closed amid the coronavirus pandemic, J.C. Penney is contemplating filing for bankruptcy protection, several people with knowledge of the matter told Reuters on Tuesday.

The company has had to furlough some of its 85,000 employees, and there are concerns that even when stores reopen, shoppers might not return, Reuters reports. While J.C. Penney has enough cash available to make it through the next few months, regulatory filings show it has a debt payment of about $12 million due on Wednesday and a $105 million bond repayment coming up in June.

While exploring bankruptcy is one way to save money on debt payments, it's not the only thing J.C. Penney is mulling over, Reuters reports — the company is also considering asking creditors to rework its debt and could seek rescue financing. In a statement, a J.C. Penney spokeswoman said the company "has been engaged in discussions with its lenders since mid-2019 to evaluate options to strengthen its balance sheet and maximize its financial flexibility, a process that has become even more important as our stores have also closed due to the pandemic."

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