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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) - October 18, 1999
J. C. PENNEY COMPANY, INC.
(Exact name of registrant as specified in its charter)
Delaware 1-777 13-5583779
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File No.) Identification No.)
6501 Legacy Drive
Plano, Texas 75024-3698
(Address of principal (Zip code)
executive offices)
Registrant's telephone number, including area code: (972) 431-1000
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Item 5. Other Events.
______ ____________
On October 18, 1999, J. C. Penney Company, Inc. ("JCPenney") issued a
press release announcing that it had entered into an agreement with General
Electric Capital Corporation ("GE Capital") pursuant to which JCPenney
would sell to GE Capital substantially all of the assets relating to
JCPenney's consumer and commercial private label credit card business. The
closing of the transaction is subject to regulatory approval. The press
release describing the transaction is incorporated by reference herein to
Exhibit 20.1 hereto.
Item 7. Financial Statements and Exhibits.
______ _________________________________
(c) Exhibits.
20.1 J. C. Penney Company, Inc. press release dated October
18, 1999.
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SIGNATURES
__________
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
J. C. PENNEY COMPANY, INC.
/s/ D. A. McKay
________________________________________
D. A. McKay
Executive Vice President
and Chief Financial Officer
Date: November 1, 1999
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EXHIBIT INDEX
Exhibit
Number Description
______ ___________
20.1 J. C. Penney Company, Inc. press release dated
October 18, 1999.
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JCPENNEY NEWS RELEASE
CONTACT
Duncan Muir Stephen Blum Eli Akresh
Public Relations Investor Relations Investor Relations
(972) 431-1329 (972) 431-5469 (972) 431-2207
JCPENNEY ALIGNS WITH GE CAPITAL TO MARKET AND OPERATE JCPENNEY CREDIT CARD
Completes First Step of Plan to Enhance Stockholder Value
PLANO, TX, October 18, 1999 - J.C. Penney Company, Inc.(JCP:NYSE)
today announced it has completed the first step of a previously announced
plan to enhance stockholder value whereby GE Card Services, a GE Capital
company, will acquire JCPenney's private label credit card accounts
receivable portfolio and credit facilities. In addition, JCPenney will
enter into a ten-year agreement with GE Capital to provide private label
credit card services. This move will strengthen the competitiveness and
appeal of the JCPenney credit card, and at the same time, the sale of the
accounts receivable portfolio will enable the Company to significantly
reduce debt.
James E. Oesterreicher, chairman and chief executive officer of
JCPenney said, "By selling the receivables portfolio, we will free up
substantial cash to reduce debt, strengthen our balance sheet and pave the
way for our previously announced creation and initial public offering
("IPO") of approximately 20 per cent of a tracking stock covering
JCPenney's Eckerd Drugstore business. In addition, our customers will
continue to receive the high level of service they're accustomed to, and
now, together with GE Capital, we will provide more benefits for shopping
with our exclusive card. The JCPenney card will be a stronger future
business driver because it will provide our customers with added incentives
for its use, including more features than we now offer."
"We'll work together with JCPenney so customers can get more from
their JCPenney credit card, more benefits and new ways to use the card,"
said Edward D. Stewart, president and CEO, GE Card Services. "The JCPenney
card will be strengthened with expanded promotional offers to customers,
more favorable repayment terms, a multimillion dollar relaunch and on line
support for all JCPenney products and services. From a business
standpoint, this acquisition fits perfectly with GE Card Services'
expertise managing and marketing private label credit card programs to
strengthen customer relationships for retail partners."
Public Relations J. C. Penney Company, Inc., 6501 Legacy Drive, Plano
Texas 75024
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Terms of the agreement were not disclosed. The transaction, subject
to regulatory approval, is expected to close in the fourth quarter.
Following the transaction, the Company expects to reduce approximately $3.8
to $4.0 billion of debt.
In 1998, JCPenney had credit card sales of $7.8 billion and 35 million
accounts. The company has 11 credit facilities, with approximately 2,800
employees, in 10 U.S. cities and Puerto Rico. Upon closing, GE Capital
will operate these facilities with existing personnel and evaluate the
resources and facilities needed to support its business in the future.
GE Card Services, which has 70 million private label credit card
accounts on file, is a GE Capital company. With assets of more than US$300
billion, GE Capital is a global, diversified financial services company
with 28 specialized businesses. A wholly owned subsidiary of General
Electric Company, GE Capital, based in Stamford, Conn., provides equipment
management, mid-market and specialized financing, specialty insurance and a
variety of consumer services, such as car leasing, home mortgages and
credit cards, to businesses and individuals around the world. GE is a
diversified manufacturing, technology and services company with operations
worldwide.
J. C. Penney Company, Inc. is one of America's largest department
store, drugstore, and catalog retailers employing more than 260,000
associates. The Company operates nearly 1,150 JCPenney department stores
in all 50 states, Puerto Rico, and Mexico. In addition, the Company
operates 23 Renner department stores in Brazil. Eckerd Drugstores is
comprised of nearly 2,900 drugstores located in the Southeast, Sunbelt, and
Northeast regions of the U.S. JCPenney Catalog, including e-commerce, is
the nation's largest catalog merchant of general merchandise. JCPenney
Direct Marketing Services markets insurance products and membership
services to various credit card customers by direct response solicitations
primarily in the United States and Canada.
This release may contain forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. Such forward-
looking statements, which reflect the Company's current views of future
events and financial performance, involve known and unknown risks and
uncertainties that may cause the Company's actual results to be materially
different from planned or expected results. Those risks and uncertainties
include but are not limited to, competition, consumer demand, seasonality,
economic conditions, and government activity, and the Year 2000 compliance
readiness of JCPenney's suppliers and service providers as well as
government agencies. Investors should take such risks into account when
making investment decisions.
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