The lenders steering J.C. Penney Co.’s bankruptcy are considering joining forces with an outside bidder to buy the retailer after efforts to line up an independent owner stalled, Bloomberg News reported. The plan envisions the hedge funds that hold J.C. Penney’s loans would become co-owners of a business they never planned to run, in partnership with a third party that could include one of the potential buyers they’ve been wooing, according to people with knowledge of the developments. The lender group was already set to take over most of J.C. Penney’s real estate at the outset of the bankruptcy case. This would have involved spinning the properties into a real estate investment trust and selling the rest of the retailer to the highest bidder. Potential bidders Simon Property Group Inc. and Brookfield Property Partners had clashed with the lender group over terms including redevelopment rights and the restrictions imposed by the master lease agreement. The mall owners’ buyout bid was considered the best hope for keeping more of the retailer’s stores open. The private equity firm Sycamore Partners has also held bid talks with lenders, as has Authentic Brands Group LLC. Sycamore owns the department store chain Belk Inc., among other retailers, and Authentic recently bought Brooks Brothers out of bankruptcy.
