%1

Department store operator Macy’s Inc. said yesterday that it would close about 45 stores this year as part of its three-year plan to lower store count in order to focus on its more productive outlets, Reuters reported. Even before the lockdowns in the U.S. last year, Macy’s had announced the plan to close 125 of its least productive stores to tackle plummeting mall traffic. It had closed about 30 stores in 2020. “Macy’s is committed to rightsizing our store fleet by concentrating our existing retail locations in desirable and well-trafficked A and B malls,” Macy’s said in an emailed statement on Tuesday. The COVID-19 outbreak has worsened the plight of certain mall-based chains, forcing them to shutter stores and double down on their online business, while few chains are looking to open smaller stores in off-mall locations. Macy’s, which operates over 750 shops, including Bluemercury, Bloomingdale’s and its eponymous stores, said it would post a list of stores expected to be closed this year on its website today.

With his presidential inauguration just weeks away, Joseph R. Biden Jr. is confronting an economic crisis that is utterly unparalleled and yet eerily familiar. Millions of Americans are out of work, small businesses are struggling to survive, hunger is rampant, and people across the country fear getting kicked out of their homes, the New York Times reported. The moment was similarly perilous exactly 12 years ago, when Biden was the vice president-elect and preparing to take office. “I remember the utter terror,” said Cecilia Rouse, who was an economic adviser in the Obama White House and has been chosen to lead Mr. Biden’s Council of Economic Advisers. The $900 billion pandemic relief plan that moderate lawmakers powered through Congress last month provides the incoming administration with some breathing room. This second tier of aid will deliver $600 stimulus checks, assist small businesses and extend federal unemployment benefits through mid-March. But as Biden has made clear, it is simply a “down payment” — a brief bridge to get through a dark winter and not nearly enough to restore the economy’s health.

Tuesday Morning emerged from chapter 11 protection, it announced yesterday, with financial backing from J.P. Morgan, Wells Fargo, and Bank of America, the Dallas Business Journal reported. The Dallas-based off-price home goods retailer filed for bankruptcy in May due to challenges from the COVID-19 pandemic. The ascent from chapter 11 is possible with a $110 million asset-backed lending facility provided by J.P. Morgan, Wells Fargo, and Bank of America, according to a release. “We have emerged with a streamlined operating model, and are well-positioned to execute on our strategy,” said CEO Steve Becker in a prepared statement. The release said that the additional liquidity will support Tuesday Morning’s ongoing operations and strategic initiatives. At the time it filed for bankruptcy, it had 687 stores that it planned to close in phases to help deal with the fallout from the lockdown. It’s emerging with 490 of its best-performing stores.

American companies will have to pay higher taxes on some of the products they import from China, as the tariff exclusions that had shielded many businesses from President Trump’s trade war expired at midnight on Thursday, the New York Times reported. Trump began placing tariffs on more than $360 billion of Chinese goods in 2018, prompting thousands of companies to ask the administration for temporary waivers excluding them from the levies. Companies that met certain requirements were given a pass on paying the taxes, which range from 7.5 percent to 25 percent. Those included firms that import electric motors, microscopes, salad spinners, thermostats, breast pumps, ball bearings, fork lifts and other products. But the bulk of those exclusions, which could amount to billions in revenue for businesses based in the United States, were set to automatically expire at midnight on Thursday. After that, many companies have to again pay a tax to the government to import a variety of goods from China, including textiles, industrial components and other assorted products. The lack of clarity from the Trump administration about whether it would extend the exclusions left many companies in limbo. The United States had announced some extensions — on Dec. 23, the trade representative said that it would extend exclusions until March 31 for a small category of medical care products, including hand sanitizer, masks and medical devices, to help with the battle against the coronavirus pandemic. But Ben Bidwell, the director of U.S. customs at the freight forwarder C.H. Robinson, who has been helping clients apply for exclusions, said that “the large majority” of those that had been granted would expire at the end of the year, leaving importers with either an additional 7.5 percent or 25 percent tariff, depending on their product.

AMC Entertainment Holdings Inc., the world’s largest cinema operator, plans to offer as many as 50 million more shares as it tries to stave off a bankruptcy filing, Bloomberg News reported. The offering adds onto 200 million shares the Leawood, Kansas-based company registered earlier this month, it said in a filing yesterday. AMC warned again in the new document that it might have to seek an in-court or out-of-court restructuring, which could wipe out its equity investors. The company has said that it needs to raise $750 million. AMC declined again after setting plans for a new stock offering. Movie-theater owners have been hit hard by the coronavirus pandemic. The superhero sequel “Wonder Woman 1984” had the biggest theatrical opening of the crisis last weekend but generated just $16.7 million at the North American box office. Its studio, AT&T Inc.’s Warner Bros., said only 39 percent of U.S. cinemas were open, at limited capacity.

The new owners of JCPenney replaced Chief Executive Officer Jill Soltau less than a month after re-launching the department store chain that went bankrupt during the pandemic, Bloomberg News reported. Soltau will depart Dec. 31 and be succeeded by Stanley Shashoua, the chief investment officer of Simon Property Group Inc., while a search for a new CEO is conducted, according to a statement Wednesday. Mall owners Simon and Brookfield Asset Management Inc. acquired the retail operations of J.C. Penney Co. to help keep one of their biggest tenants in business. The brief, two-paragraph announcement gave no explanation for the CEO change. Soltau, hired in October 2018, was in the middle of overseeing her own turnaround plan and putting a new team in place when the Covid-19 pandemic swept the globe this year and temporarily shuttered many retail stores. By May, J.C. Penney Co. was bankrupt. She remained in the top job throughout the bankruptcy process, and the new owners highlighted her comments as CEO in the Dec. 7 announcement of the relaunch under the JCPenney name. Simon and Brookfield plan to establish a temporary office of the CEO that will include members of JCPenney’s current management team, according to the statement. J.C. Penney Co. was split up during the bankruptcy into the operating company, which is owned by the mall operators, while lenders get the property company. The latter remains in the chapter 11 process and is expected to emerge in the first half of 2021.

U.S. jeweler Tiffany & Co’s shareholders on Wednesday approved a $15.8 billion deal with France’s LVMH, ending an acrimonious dispute between the two luxury retailers that had stretched for more than a year, Reuters reported. At a virtual special stockholder meeting, more than 99 percent of votes cast were in favor of the deal. Billionaire Bernard Arnault-led LVMH made the first offer late last year, but as the luxury industry slipped into a turmoil due to the COVID-19 pandemic the company backed out from its promise to close the deal. LVMH also cited French political intervention to delay completing the acquisition until Jan. 6, pushing Tiffany into a legal battle in September to force LVMH to honor the deal.

President Trump unexpectedly capitulated yesterday and signed the stimulus bill into law, releasing $900 billion in emergency relief funds into the economy and averting a Tuesday government shutdown, the Washington Post reported. White House officials didn’t explain why the president decided to suddenly back down and sign into law a bill he had held up for nearly a week and had referred to as a “disgrace” just days earlier. Trump signed the bill while vacationing in Florida and on a weekend when he had allowed unemployment benefits for 14 million Americans to expire. He had demanded changes to the stimulus and spending package for a week, suggesting he would refuse to sign it until these demands were met. This continued defiance caused lawmakers from both parties to panic over the weekend, worried about the implications of a government shutdown during a pandemic. It was unclear what prompted him to change his mind late Sunday, but he was under tremendous pressure from Republicans to acquiesce. The package will extend aid to millions of struggling households through stimulus checks, enhanced federal unemployment benefits, and money for small businesses, schools and child care, as well as for vaccine distribution. It also repurposes $429 billion in unused funding provided by the Cares Act for emergency lending programs run by the Federal Reserve. Read more.

Click here for the text of the legislative package signed into law yesterday: 

K&W Cafeteria Inc. has received federal Bankruptcy Court permission to delay filing its next proposed reorganization plan by three months to March 31, the Winston-Salem (N.C.) Journal reported. Judge Benjamin Kahn also approved giving the Winston-Salem restaurant chain three additional months, or until May 30, to gain confirmation of the plan. Approval of the delays come as K&W's owners and management say they want to change course on its future after saying it did not attract an adequate bid for its assets. K&W, a staple of Southern comfort foods for 83 years, filed for bankruptcy protection Sept. 2 as the latest step in a corporate downsizing that began before the COVID-19 pandemic. Judge Kahn separately approved the sale of two company-owned properties in Cornelius for a combined $1.47 million.

U.S. retail sales rose 3 percent during this year’s expanded holiday shopping season from Oct. 11 to Dec. 24, a report by Mastercard Inc said on Saturday, powered by a pandemic-driven shift toward online shopping. U.S. ecommerce sales jumped 49% in this year’s holiday shopping season, according to Mastercard SpendingPulse report, underscoring the COVID-19 pandemic’s role in transforming customers’ shopping habits. Holiday e-commerce sales made up 19.7 percent of total retail sales this year, the data showed, noting that options such as buy online and pick-up-in-store, contactless technologies were key for retailers. The holiday shopping season can account for the majority of certain retailers’ annual sales, but the health crisis meant several retailers including Walmart Inc and Target Corp, faced with capacity constraints in certain stores, rolled out their holiday promotions early.