J.C. Penney discloses SEC inquiry into stock sale, finances
J.C. Penney, the beleaguered Plano, Texas-based retailer, disclosed in a regulatory filing late Thursday that the U.S. Securities and Exchange Commission has inquired into its finances and a recent public offering that raised $785 million.
In a quarterly filing, the company wrote that it received a letter of inquiry from the SEC in early October, “requesting information regarding the company’s liquidity, cash position, and debt and equity financing.”
Regulators also sought information regarding its September stock sale that raised $785 million, the company said. The public offering was intended to boost the retailer’s cash proceeds. The action, however, irked investors who accused the company of misrepresenting its financial situation.
In October, shareholder Alan Marcus filed a lawsuit that said J.C. Penney misled investors by giving public assurances in August that the company saw no need to raise capital, but subsequently reversed its position a month later. Marcus alleges that the company’s statements artificially inflated the share price.
An email seeking comment was not immediately returned Thursday.
The regulatory disclosure comes as the company is trying to reverse steep declines in sales and department store foot traffic.
J.C. Penney executives recently said their turnaround efforts are showing signs of promise and that they expect to have more than $2 billion in cash proceeds and other liquid assets by the year’s end.
Company shares fell $0.34, or 3.84%, to $8.51 in after-hours trading.
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