J.C. Penney increased its borrowing capacity under a bank credit facility by $100 million to $1.85 billion and expanded an option to borrow more at a later date, raising concerns among analysts as it works on a turnaround.

According to an 8-K filing, J.P. Morgan Securities, Merrill Lynch, Barclays and Wells Fargo Capital Finance acted as joint bookrunners and lead arrangers for the transaction. Bank of America, Barclays Bank and Wells Fargo Bank acted as joint documentation agents. The deal was led by JPMorgan Chase as administrative agent for a 27-bank lender group and Wells Fargo Bank, as LC agent. (See below for institutional commitments)

The new arrangements included a $150 million increase in the credit facility’s accordion feature to $400 million and a $250 million increase in an additional feature, analysts said. An accordion feature allows a borrower to expand a credit facility at a later date.

Penney, which operates 1,100 department stores, began a turnaround a year ago that called for the elimination of most coupons and sales events. Long-term customers, trained for years to seek out discounts, balked at the new pricing strategy and reeled in purchases.

INSTITUTION COMMITMENT

JPMorgan Chase Bank
$187,500,000

Bank of America
$187,500,000

Barclays Bank
$187,500,000

Wells Fargo Bank
$187,500,000

UBS Loan Finance
$100,000,000

BBVA Compass
$90,000,000

HSBC Bank USA
$90,000,000

The Royal Bank of Scotland
$75,000,000

U.S. Bank
$75,000,000

Citibank
$60,000,000

Goldman Sachs Bank USA
$60,000,000

The Bank of New York Mellon
$45,000,000

Standard Chartered Bank
$45,000,000

State Street Bank and Trust Company
$45,000,000

UMB Bank
$45,000,000

Regions Bank
$45,000,000

Siemens Financial Services
$45,000,000

PNC Bank
$45,000,000

City National Bank
$32,500,000

Flagstar Bank
$32,500,000

The Bank of Tokyo-Mitsubishi UFJ
$30,000,000

Union Bank
$30,000,000

KeyBank
$25,000,000

Banco Popular de Puerto Rico
$25,000,000

The Northern Trust Company
$25,000,000

Capital One
$25,000,000

Chang Hwa Commercial Bank
$10,000,000

Total
$1,850,000,000

To read a related Reuters story, click here.