J.C. Penney is almost at the end of its bankruptcy after getting a verbal confirmation Tuesday of its plan from Bankruptcy Judge David Jones, the Dallas Morning News reported. That plan of reorganization includes the sale of the retail company to landlords Simon and Brookfield and a big chunk of its real estate to lenders to pay down debt. The pending transaction includes a complex document for the transfer of 160 stores and six distribution centers to Penney’s lenders. Penney’s shareholders continued to object to the plan’s treatment of their rights to future claims, their lawyer Mathew Okin said at the hearing. In response, Judge Jones granted shareholders pre-petition claim status, giving them future rights if they pursue a legal case. The judge deemed himself the gatekeeper of that status but noted that any shareholder claims would be dwarfed by creditors who have agreed to the plan of reorganization. Penney’s shareholders are holding stock with no value but haven’t accepted that the bankruptcy plan has canceled their equity. Judge Jones had allowed them to form an ad hoc equity committee and approved funds to pay fees for financial and legal assistance.
