"Zombie Mall" Store King Emerges As JCPenney Merges With Forever 21

JCPenney is merging with Sparc Group, the parent company of several once-bankrupt clothing brands, including Forever 21 and Brooks Brothers, to form a new retail powerhouse, Jordan Valinsky reported for CNN.

The new company, Catalyst Brands, will bring together the 123-year-old department store chain and a portfolio of mall staples. I Photo: Mike Mozart Flickr

The new company, Catalyst Brands, will bring together the 123-year-old department store chain and a portfolio of mall staples, including Lucky Brand, Eddie Bauer, Nautica, and Aeropostale.

Backed by major mall operators Simon Property Group and Brookfield, Catalyst Brands represents a gamble that combining these beleaguered brands can create a revitalized force in retail.

JCPenney’s merger marks a new chapter for the historic chain, which filed for bankruptcy during the pandemic in 2020. It was acquired by Simon and Brookfield for $1.75 billion. Sparc Group, also supported by Simon, has steadily expanded its portfolio by acquiring struggling brands and working on their revitalization.

Neil Saunders, retail analyst and managing director at GlobalData Retail, said the merger could yield significant synergies through cost reductions, cross-marketing, and talent sharing.

“Catalyst Brands is betting that a unified approach can breathe new life into these well-known names while solidifying their presence in America’s malls,” Saunders noted.