J.C. Penney Lender Fight Shows Competing Bankruptcy Interests
As the J.C. Penney bankruptcy heads toward a hearing next week on its planned sale, the conflict between the retailer’s majority and minority lender groups has still not abated.
The conflict, some version of which plays out in many bankruptcies, shows how competing interests in a Chapter 11 can clash in a process in which many groups of creditors are often asked to accept reduced recoveries, attorneys said.
“Somebody is out of the money, and somebody is in the money…and objections [can be] a means of trying to extract value for that particular constituency,” said Joel Shapiro, partner at Blank Rome LLP, who isn’t involved in the Penney’s case and spoke broadly.
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“J.C. Penney Lender Fight Shows Competing Bankruptcy Interests,” by Sindhu Sundar was published in WWD on October 27, 2020.