KKR & Co. Inc., Blackstone Group Inc. and other big lenders to department store chain Belk Inc. are in talks with the company to keep it out of bankruptcy after the chapter 11 process proved difficult for other retailers during the COVID-19 pandemic, WSJ Pro Bankruptcy reported. While Charlotte, N.C.-based Belk isn’t guaranteed to reach a restructuring agreement, the company, its lenders and private equity owner Sycamore Partners are getting closer to an out-of-court deal. Like other department store chains, Belk has struggled with a pullback in retail foot traffic during the COVID-19 pandemic as stuck-at-home consumers turn to online shopping. Belk’s negotiations with lenders focus on fixing the company’s balance sheet, possibly through a debt-for-equity swap or fresh financing. Bloomberg News earlier reported the negotiations. KKR and Blackstone are interested in converting part of Belk’s $2.6 billion debt into equity, possibly under an out-of-court deal that would allow Sycamore to retain an ownership stake.
