The corporate that owns the long-lasting luxurious retailer Saks Fifth Avenue filed for chapter late Tuesday.
The transfer comes after Saks International struggled with debt it took on to purchase rival Neiman Marcus, lagging division retailer gross sales and a rising on-line market.
It is one of many largest retail collapses because the Covid-19 pandemic, and casts additional doubt over the way forward for luxurious style.
The retailer, which additionally owns Bergdorf Goodman, stated early Wednesday its shops would stay open for now after it finalized a $1.75 billion financing package deal and appointed a brand new CEO.
The courtroom course of is supposed to offer the posh retailer room to barter a debt restructuring with collectors or promote itself to a brand new proprietor to stave off liquidation. Failing that, the corporate could also be pressured to shutter.
Former Neiman Marcus CEO Geoffroy van Raemdonck will exchange Richard Baker, who was the architect of the acquisition technique that left Saks International saddled with debt.
The corporate additionally appointed former Neiman Marcus executives Darcy Penick and Lana Todorovich as chief business officer and chief of world model partnerships at Saks International, respectively.
Saks Fifth Avenue, the retail arm of Saks International, listed $1 billion to $10 billion in belongings and liabilities, in line with courtroom paperwork filed in U.S. Chapter Courtroom in Houston, Texas.
A retailer lengthy liked by the wealthy and well-known, from Gary Cooper to Grace Kelly, Saks fell on onerous occasions after the pandemic, as competitors from on-line shops rose, and types began extra steadily promoting gadgets by their very own shops.
The unique Saks Fifth Avenue retailer, recognized for displaying the likes of Chanel, Cucinelli and Burberry, was opened by retail pioneer Andrew Saks in 1867.
The brand new financing deal would offer an instantaneous money infusion of $1 billion by a mortgage from an investor group, Saks International stated.
A bunch of luxurious manufacturers had been among the many unsecured collectors, led by Chanel and Gucci proprietor Kering at about $136 million and $60 million respectively, the courtroom submitting stated. The world’s largest luxurious conglomerate, LVMH, was listed as an unsecured creditor at $26 million. In whole, Saks International estimated there have been between 10,001 and 25,000 collectors.
In 2024, Baker had masterminded the takeover of Neiman Marcus by Canada’s Hudson’s Bay Co, which had owned Saks since 2013, and later spun off the U.S. luxurious belongings to create Saks International, bringing collectively three names which have outlined American excessive style for over a century.
The deal was designed to create a luxurious powerhouse, however it saddled Saks International with debt at a time when world luxurious gross sales had been slowing, complicating an already troublesome turnaround for CEO and veteran government Marc Metrick.
Saks International struggled final 12 months to pay distributors, who started withholding stock, disrupting the corporate’s provide chain and leaving it with inadequate inventory.
The thinly stocked cabinets might have pushed buyers away to rivals like Bloomingdale’s, which posted sturdy gross sales in 2025, compounding strain on Saks International.
“Wealthy individuals are nonetheless shopping for,” Morningstar analyst David Swartz stated final month, “simply not a lot at Saks.”
Operating out of money, Saks International final month offered the actual property of the Neiman Marcus Beverly Hills flagship retailer for an undisclosed quantity. It had additionally been seeking to promote a minority stake in unique division retailer Bergdorf Goodman to assist minimize debt.
On December 30, it did not make an curiosity cost of greater than $100 million to bondholders.
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