Sparc Group, which operates popular fashion brands like Lucky, Eddie Bauer, Aeropostale, Forever 21, and Brooks Brothers, has entered into a merger with JCPenney to form a new entity named Catalyst Brands. The deal was an all-equity transaction involving JCPenney, Sparc Group, and its major shareholders: Simon Property Group, Brookfield Corp., Authentic Brands Group, and SheIn Group Ltd.
Marc Rosen, the former CEO of JCPenney, will lead the newly formed Catalyst Brands. The combined entity now boasts an impressive scale, with roughly $9 billion in revenue, 1,800 store locations, a workforce of 60,000 employees, and $1 billion in liquidity.
As part of the restructuring, Catalyst has sold its U.S. operations of Reebok and is considering strategic options for the operations of Forever 21.
Authentic Brands, which purchased the Forever 21 name out of bankruptcy in 2020, had previously licensed the brand to Sparc Group, allowing it to operate around 500 stores, some of which are located in Simon Property malls. This arrangement proved advantageous for both parties, helping to keep mall spaces occupied while providing Authentic Brands with an additional revenue stream.
In 2020, JCPenney filed for bankruptcy protection and was subsequently acquired by Simon Property Group and Brookfield Asset Management Inc. for $800 million. This latest merger signals a new chapter for both JCPenney and Sparc Group, consolidating their operations under the Catalyst Brands umbrella.
