J.C. Penney

The Situation

  • J.C. Penney is a publicly traded company with 846 corporate locations and 12B in annual revenue
  • Company was impacted by COVID-19 pandemic and government shutdown orders s in March 2020, along with other retailers
  • Projecting an extended shutdown, company believed it would run out of money by July 2020 and elected to file Chapter 11 bankruptcy
  • Company struggled prior to COVID, with significant turnover in the executive suite that resulted in changes to business and merchandising plans


  • Financial Advisor to Ad Hoc Equity Committee (AHEC)

The Work

  • CR3 Partners was retained as financial advisor to Ad Hoc Equity Committee (AHEC), which represented both sophisticated and inexperienced retail shareholders
  • When AHEC was formed, retailers had begun to open, online sales were doing well, and company averted a liquidity crisis as cash grew to $1.5B
  • Improved financial conditions indicated that equity value remained
  • Produced report and provided expert testimony regarding equity value

The Results

  • Analyzed company‚Äôs business plan and assets, as well as other distressed retailers, and produced two expert reports regarding condition of business and potential valuation range
  • Provided significant expert witness testimony at sale and confirmation hearings in support of valuation in excess of materially distressed value alleged by lenders to convey assets to first-lien lenders and landlord buyer group

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  • Retail
  • Financial Advisory

Engagement Team