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. 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. JPMorgan Chase Bank, Bank of America, Barclays Bank and Wells Fargo Bank each committed $187.5 million. 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.
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, Reuters reported.