J.C. Penney Restructures

J.C.Penney Co. (Plano, Texas) has announced a change in its corporate structure to a holding company format, effective Jan. 27, 2002.

The previous J. C. Penney Co. Inc. has changed its name to J. C. Penney Corp. Inc., and has become a wholly owned subsidiary of the new holding company, which assumed the name J. C. Penney Co. Inc.

“This structure, which is used by many companies with multiple businesses, creates a basic framework to facilitate organizational, operational, and strategic decision-making,” said chairman and ceo Allen Questrom. “This step will not result in any immediate changes to operations, but we believe that the new structure will provide us with more flexibility as we progress with the rebuilding of our businesses.”

Some have speculated that the move is a precursor to dumping the 2600-unit Eckerd drug store chain that Penney purchased in 1996. The $13 billion subsidiary lost about $600,000 last year. Penney has previously considered spinning Eckerd off. Last week, the chain was being investigated by the Securities and Exchange Commission on allegations of accounting malpractice and Medicare fraud.