A plan to sell bankrupt JCPenney Co.’s retail operations to its two biggest landlords stalled this week, raising the prospect that creditors will carry the burden of millions of dollars in extra costs as the retailer prepares for the crucial holiday season, Bloomberg News reported. Talks between JCPenney’s lenders and the would-be buyers, mall owners Simon Property Group Inc. and Brookfield Property Partners LP, have broken down in recent days. The landlords missed several deal deadlines as communication between the parties lapsed. The two sides will now turn to mediation to help them determine whether they can close the deal, and on what terms. They met to begin that process on Wednesday. An attorney for the company has said that disputes won’t stand in the way of a final agreement. Representatives for Brookfield, Simon, JCPenney and its lender group didn’t comment. The standstill comes ahead of JCPenney’s most crucial quarter, since retailers typically make much of their annual revenue in the period between Thanksgiving and the new year. At stake in the coming weeks is financial responsibility for tens of millions of dollars of orders, including merchandise the company must have in stock for holiday shopping. Creditors say JCPenney’s original sale plan called for the deal to close around October 3, according to a regulatory filing on Wednesday. A further delay in closing the deal threatens to put the holiday purchasing burden onto the group of creditors running JCPenney in its bankruptcy.
