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Troubled JC Penney Searching For New CEO

JCPenney has survived the ups and downs of the economy for 118 years … but whether it will survive much longer is open to question.

The company now hopes new blood in the CEO suite will help JCPenney turn around a dire situation that saw the department store chain file for bankruptcy in May, after losing money for 10 straight years. CEO Jill Soltau, who took on the position just two years ago, left the company on New Year’s Eve and the company has announced it is actively searching for her replacement.

The new owners of the company—Simon Property Group and Brookfield Asset Management—appointed Simons’ Chief Investment Officer Stanley Shashoua as JCPenney’s interim CEO, who will be backed by current members of the company’s C-level executive team.

In a press release, the retailer said, “The search will seek to identify a leader that is focused on modern retail, the consumer experience, and the goal of creating a sustainable and enduring JCPenney.”

SPG and BAM were the company’s main landlords, and acquired JCPenney’s assets through the bankruptcy proceeding. In so doing, the company has acquired a critical lifeline, slashing its debt and reducing the number of stores from 846 to less than 700. Roughly 25,000 jobs were eliminated, although the company still employs an estimated 60,000 people.

At the time of the acquisition, Soltau  said she was fully in favor of the deal. “This transaction is a testament to the thousands of dedicated employees who have been working incredibly hard over the last several months under difficult circumstances,” Soltau said in September. “Our customers are at the heart of JCPenney and we look forward to serving them under the JCPenney banner for decades to come.”

Despite the reduction in debt and fresh capital from the new owners, JC Penney still faces significant challenges due to the need to restructure its operations while COVID-19 continues to ravage the retail landscape. Unlike stores like Walmart or Target, JCPenney doesn’t sell food, and many stores lost sales when they were closed or restricted during the wave of lockdowns in the United States last year.

 

 

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