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J. Crew Bonds Show IPO Odds Vanishing With Profits

The bonds J. Crew Group Inc. sold last year to finance a dividend for its private-equity owners are indicating diminished odds that the retailer will explore a stock sale anytime soon.

Bondholders had been pricing in the possibility of an initial public offering this year, according to Tom O’Neill, an analyst at Canaccord Genuity Group Inc. The $500 million of notes, which are callable at 102 cents on the dollar in November or upon an IPO, were quoted above that level until the chain owned by TPG Capital and Leonard Green & Partners LP reported a net loss of $30.1 million in the quarter ended May 3. A drop to 101, below the call price, suggests a receding chance of an IPO.