JC Penney Makes Skipped $17 Million Interest Payment As Bankruptcy Filing Is Expected Friday

Struggling JC Penney (JCP) may have pushed off its expected bankruptcy filing for a moment as it made a $17 million interest payment on Friday, according to its Securities and Exchange Commission filing.

The department store retailer previously skipped the interest payment, entering into a five day grace period. With the payment made, it suggests that JC Penney may be in talks with its lenders and could delay the bankruptcy filing, sources for CNBC said.

JC Penney has been looking to secure a $450 million loan to finance its bankruptcy restructuring, which would allow the company to receive half of the monies upfront and the remaining balance as it hits certain predetermined milestones, the news outlet said.

JC Penney was expected to file for bankruptcy protection on Friday after skipping the $17 million interest payment and a $12 million interest payment in April. The company’s grace period on the later interest payment expires Friday, according to its SEC filing.

The company has struggled to turn its retail business around, closing stores and a call center, and laying off employees. JC Penney’s challenges were further complicated by the coronavirus pandemic, which forced all of its stores to close in March. The majority of the retailer’s workforce was furloughed a month later.

JC Penney reportedly had about 846 stores and about 90,000 employees as of February. Through the possible bankruptcy filing, the company is considering closing 180 to 200 stores, CNBC said.

Shares of JC Penney stock were up 34.5818% as of 11:49 a.m. EDT on Friday.