UPDATE 1-Hayman Capital sells entire stake in J.C. Penney -Bloomberg TV
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Dec 5 (Reuters) - Hedge fund Hayman Capital Management LP sold all its shares in J.C. Penney but still holds the ailing retailer's debt, fund manager Kyle Bass told Bloomberg TV on Thursday.
Penney's shares fell as much as 10 percent, the biggest drop since Sept. 27, before closing down 8.4 percent at $8.85 on the New York Stock Exchange.
Dallas-based Hayman disclosed a 5.2 percent stake in Penney in September. In November it reported that it had reduced the stake to about 1.87 percent. (link.reuters.com/qaz25v)
Hayman Capital is known for earning millions by betting against the overheated subprime mortgage market before the financial crisis.
J.C. Penney said on Tuesday that comparable-store sales rose for the second straight month in November as its aggressive discounts and the return of some in-house brands brought shoppers back to its stores.
Bass told CNBC television on Oct. 9 that while he believed J.C. Penney's chief executive, Mike Ullman, and his team would be able to stabilize sales, his firm was "not investing in a turnaround" of the company.
Aaron Cowen, chief investment officer of Suvretta Capital Management LLC, told Reuters last month that J.C. Penney shares offer insufficient reward for the risk.
He said the company could go bankrupt within the next several years if it continued along its "current trajectory for long periods of time." (Reporting by Aditi Shrivastava and Sam Forgione; Editing by Don Sebastian and Leslie Adler)