J.C. Penney’s Shares Plunge on Report on Financing Woes
NEW YORK (AP) — J.C. Penney’ s shares plunged Wednesday after a report that CIT, the largest lender in the clothing industry, has stopped providing financial support to small suppliers selling to Penney stores.
According to the New York Post’s online report, published Wednesday, CIT made the decision after meeting with Penney officials to examine the company’s financial statements. The newspaper quoted unnamed sources.
Officials at Penney and CIT didn’t immediately return calls.
Shares of Penney fell more than 10 percent, or $1.66, to close at $14.60, but added 19 cents in after-market trading.
Penney has been struggling to reverse disastrous results from a failed strategy by former CEO Ron Johnson to transform the retailer. Johnson was ousted in April and the board brought back former CEO Mike Ullman, who has reintroduced frequent sales.