Report: J.C. Penney hires Blackstone to raise some $1 billion
New York — J.C. Penney Co. has hired the Blackstone Group explore how best to position the firm financially and help it raise cash, the Wall Street Journal reported.
The company is reportedly seeking $1 billion in cash, according to the Wall Street Journal, which added that options could include selling a minority stake. Penney already has been in contact with several private equity firms about a potential investment, according to the report.
A Penney spokeswoman said in the article that the company has hired outside advisors over the last several for "expertise about how to best position the company from a financial standpoint during the transformation.”
Retail sales fall 0.4% in March
New York – U.S. retail sales fell 0.4% in March, the biggest decrease in nine months, amid a slowdown in hiring and higher taxes. Excluding sales of autos, gas and building materials, core sales dropped 0.2% in March, following a 0.3% increase in January.
“The fall off in spending is no surprise,” said NRF chief economist Jack Kleinhenz. “A colder-than-usual winter, an anemic employment picture and delays in tax refunds impacted consumer spending across the board in March. While we remain optimistic that retail sales will grow modestly this year, it seems like the economy is off to a shaky start as we enter the second quarter. Improving housing prices and lower gas prices may help to offset the toll of increased taxes and sequester.”
Seven of 13 major categories tracked by the Commerce Department showed declines in March, led by a 1.2% decrease at general merchandise stores and a 1.6% drop at electronics stores. Spending was up, however, in some segments. Furniture and home furnishing stores’ sales increased 0.9%. At clothing and clothing accessories stores, sales increased 0.1%.
On Thursday, 15 major retailers released same-store sales results for March. Many of the companies said unseasonably cold weather and early Easter cut into spring spending. According to the International Council of Shopping Centers, same-store sales rose 1.6% in March.
JCP dealt another blow in MSLO case
NEW YORK — New York State Supreme Court Justice Jeffrey Oing on Thursday refused to dismiss Macy’s Inc’s claim that Martha Stewart Living Omnimedia violated its contract when it designed certain merchandise for J.C. Penney Co., regardless of whether the items carry the Martha Stewart brand.
The ruling may impact whether Penney can sell Martha Stewart-designed home goods under a "JCP Everyday" label. The judge is expected to rule Friday on whether to temporarily block Penney from selling Martha Stewart-designed goods that Penney manufactured in that "Everyday" packaging, Reuters reported.
The judge once again stressed that he would rather the parties settle, rather than have him decide. The companies spent several weeks in mediation, but were unable to reach an agreement.
"This is a business deal that you should not have courts getting involved in," Oing said. "It’s getting to a point where the clock can’t be turned back. The ship is ready to sail."
In related news, the New York Post reported that Myron Ullman, Penney’s new CEO, is seeking a truce in the case. According to the report, Ullman’s first phone call as CEO was to Macy’s CEO Terry Lundgren.