JC Penney Shares To Be Sold By Vornado, Reports Indicate

JC Penney Shares To Be Sold By Vornado, Reports Indicate

Around ten million JC Penney Co (NYSE:JCP) shares will reportedly be sold by Vornado Realty Trust through an unregistered secondary transaction. This was revealed by someone who had some knowledge about the sale.

The block transaction will reportedly be handled by Deutsche Bank AG (NYSE:DB), the source added. The source also indicated that the price of the shares is expected to be from $16.40 up to $16.60 per share.

No statements were released by a Deutsche Bank representative. Representatives from JC Penney and Vornado also did not release any comments in connection to the reported sale.

Shares of the company have gone down by over fifty percent for the past twelve months. Fourth quarter sales of the retailer went down by 28 percent. The decline in the fourth quarter was significant since the period included the shopping season during the holidays. Sales of the retailer have gone down by around $4.3 billion during the first year of Ron Johnson, a former executive of Apple Inc who joined the company in November 2011. Among his goals was to remake JC Penney.

However, shares of the company are considered as the worst performer in the stock index of the S&P 500 for 2013 as it went down by 5.4 percent or $0.95 at $16.74 recently.

After reports on the supposed share sale emerged, stocks of the company declined by an additional 3.9 percent.

A stock sale will require an underwriter to acquire stocks from a shareholder with the goal of selling the stocks to other investors. The block deal does not normally offer any warnings as the underwriter aims to sell shares in between the close of the market and prior to the opening of the market the following day.

A regulatory filing revealed that Vornado is one of the largest shareholders of the retailer. It owns around 11 percent of the company. The chairman of Vornado is also a director of JC Penney.

Posted by James Fried on Wednesday March 06 2013, 2:10 AM EST. Ref: WSJ. Link. All trademarks acknowledged. Filed under Featured News, Finance. Comments and Trackbacks closed. Follow responses: RSS 2.0