Dive Brief:

• J.C. Penney has once again kicked out a deadline for coming to an agreement with lenders on its go-forward business plan in bankruptcy. Previously extended to July 31, the deadline has now been moved to the end of this week as the company, lenders and potential buyers try to iron out a deal, an attorney for Penney said at a Wednesday hearing.
• After an initial round of bidding came up short, some key lenders to J.C. Penney are seeking higher bids for the company, according to a Bloomberg report that cited anonymous sources. The lenders hold about $2.2 billion of Penney's debt and want bids closer to that figure. Previous bids came in at about $1.8 billion, the news service reported. 
• Bloomberg also reported that a bid from mall operators Simon Property Group and Brookfield Property Partners is "viewed more favorably," as it would likely preserve the most jobs. Private equity firm Sycamore Partners and Hudson's Bay Co. have also made bids, as the New York Post and Women's Wear Daily reported previously.  A spokesperson for J.C. Penney declined Retail Dive's request for comment. 

Dive Insight:

Twists in the story that will potentially define J.C. Penney's future come nearly daily as the company works its way through the bankruptcy process as quickly as possible. Amid the acquisition talks, Penney twice extended a deadline to win approval for a business plan with key lenders. Approval of the business plan could prove irrelevant if Penney reaches an acquisition deal. 

The retailer and its attorneys have repeated throughout the process that the most important goal is ensuring J.C. Penney remains a going concern, which would allow its tens of thousands of workers to remain employed and keep the more than a century-old banner alive. For all the news reports and hearings, the retailer's future remains an open question. 

At Wednesday's hearing, Joshua Sussberg, a partner with Kirkland & Ellis representing Penney in its Chapter 11 case, acknowledged the interest in the outcome of negotiations over Penney, but he withheld details. 

"We much prefer that these negotiations which are ongoing play themselves out over the phone, via webcams, etcetera, rather than throughout the press or during courtroom status conferences, frankly," he said. He added, "I can let everybody know that parties are working night and day to try to figure out a way in which we can pull together an overall transaction."

Sussberg said previously that the company wanted to move quickly with a process to sell Penney to a third party. He has not named any of Penney's bidders, but multiple reports have listed Simon and Brookfield, Sycamore and Hudson's Bay, owner of Saks Fifth Avenue. 

Simon and Brookfield are key stakeholders in Penney's future, together the two firms own a large share of malls that rely on Penney as an anchor. The two have teamed up already to buy Forever 21 out of bankruptcy. Meanwhile Sycamore, which owns the Belk chain among other retail banners, and Hudson's Bay are both experienced department store operators and may see what analysts like to call "synergies" in taking on another national chain. 

Whatever their interests, the parties see value in Penney. But the key question in bankruptcy is, do they see enough value to satisfy the secured lenders driving much of the process. If not, lenders may instead opt to take over Penney themselves, assuming they think they could recover enough from a reorganized Penney to cover what they've lent the retailer in the past. Or some other, more complicated future could await Penney on the other side of bankruptcy. 

For now, there is no definitive reorganization plan before the court and no stalking horse bid to set the tone for an auction, leaving Penney's fate and future ownership up in the air for now. 

The judge overseeing Penney's Chapter 11 case set a status conference for Monday, Aug. 10, at Sussberg's request. The lawyer said that the court meeting would "shed some light on everything that's been happening."