Shares of J.C. Penney Co. Inc. (NYSE: JCP) were down sharply in premarket trading this morning following a report that commercial and retail real-estate REIT Vornado Realty Trust (NYSE: VNO) has sold nearly half its reported 10.7% stake in the struggling retailer. Bloomberg News cites “two people familiar with the offering … who asked not to be identified citing lack of authorization to speak publicly.”
According to the report, Vornado sold a block of 10 million shares through Deutsche Bank. The real estate firm said last week that it took a loss of nearly $225 million last year on its investment in J.C. Penney. Vornado’s chairman, Steven Roth, is a member of J.C. Penney’s board of directors.
J.C. Penney shares have taken a horrific beating in the past year or so, down 44% in 2012 and another 15% so far in 2013. The company’s sales have fallen through the floor as CEO Ron Johnson discontinued J.C. Penney’s long-time strategy of weekly sales and discounts in favor of raising the store’s image in an effort to attract more customers. To be fair, Johnson took over a leaky boat, but his leadership has made the leaks worse not better.
Shares are down about 4.4% at $16.00 in premarket trading this morning, in a 52-week range of $15.69 to $39.73.