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Saks Global Files For Bankruptcy Amid Mounting Debt And Market Strains

    Saks Global filed for Chapter 11 bankruptcy protection on Wednesday, marking a major turning point for one of the most recognizable names in American luxury retail. The filing places Saks Global at the center of a widening crisis for department stores struggling with heavy debt, softer consumer demand, and a rapidly shifting luxury market.

    The move follows weeks of speculation after the company missed an interest payment to bondholders late last month. With proceedings now underway, the company says it will continue operating its stores and e-commerce platforms while it works to restructure its balance sheet and emerge later this year.

    Chapter 11 Filing and Immediate Leadership Changes

    As part of the filing, Saks Global’s bankruptcy proceedings were accompanied by a leadership overhaul. Former Neiman Marcus CEO Geoffroy van Raemdonck was appointed chief executive officer effective immediately, replacing Richard Baker, who had held the CEO role for just two weeks. Baker remains closely tied to the business, having been involved with Saks since Hudson’s Bay Company acquired it in 2013.

    Van Raemdonck previously led Neiman Marcus through its own restructuring and will now oversee Saks Global during the Chapter 11 process. In a statement, he described the filing as a necessary step to stabilize the business and position it for the future.

    $1.75 Billion Financing Package Secured

    A key element of the Saks Global’s bankruptcy filing is a newly secured $1.75 billion financing commitment designed to keep the company operating during restructuring. The package includes $1 billion in debtor-in-possession financing from a group of senior secured bondholders, which will fund operations throughout Chapter 11.

    An additional $500 million will become available once the company exits bankruptcy, while asset-based lenders have provided roughly $240 million in incremental liquidity. The financing allows Saks Global to avoid liquidation, a scenario that had appeared increasingly possible in recent weeks.

    Store Operations to Continue During Bankruptcy

    Despite Saks Global’s bankruptcy protection, the company said all stores and online platforms will remain open. This includes Saks Fifth Avenue, Neiman Marcus, Bergdorf Goodman, Saks OFF 5TH, Last Call, and Horchow.

    The company has filed customary “first-day” motions requesting court approval to continue paying employees, honoring customer loyalty programs, and making go-forward payments to vendors. Saks Global said it is also evaluating its operational footprint, suggesting some store closures or consolidation could occur as part of the restructuring.

    Debt-Fueled Expansion Led to Financial Strain

    The road to Saks Global’s bankruptcy accelerated after the company acquired Neiman Marcus in 2024 in a deal valued at roughly $2.7 billion. The transaction was heavily financed with debt and was intended to create a dominant luxury department store group with greater negotiating power over brands.

    Instead, the combined company struggled to generate sufficient cash flow. Saks Global began extending payment terms to vendors, moving to 90-day cycles that strained supplier relationships. Several brands reduced inventory shipments or pulled back altogether, leading to thinner assortments and declining sales.

    Missed Payments and Market Concerns

    Concerns about bankruptcy intensified when the company missed an interest payment to bondholders late last month. Its debt began trading below face value, raising questions about its ability to meet financial obligations.

    Over the summer, Saks Global attempted to stabilize its finances by securing $600 million in new financing and selling key real estate assets. Those efforts provided temporary relief but failed to address the company’s underlying cash flow problems.

    Broader Luxury Retail Challenges

    The Saks Global bankruptcy filing comes amid broader struggles in the luxury department store sector. Consumers have increasingly shifted away from traditional department stores, while many luxury brands have focused on direct-to-consumer sales through their own boutiques and websites.

    Rising prices, concerns about product quality, and an uncertain economic backdrop have also weighed on demand. Other legacy retailers have faced similar challenges in recent years, with Macy’s closing hundreds of stores and Lord & Taylor shuttering operations entirely.

    What Happens Next

    Saks Global said it expects to emerge from Chapter 11 later this year with a stronger balance sheet and a more focused operating model. Van Raemdonck said the company will work closely with employees, vendors, and brand partners throughout the restructuring.

    For now, Saks Global and bankruptcy proceedings represent one of the most significant restructurings in luxury retail in recent memory, raising questions about the future of department stores in an industry increasingly shaped by digital commerce and brand-owned retail.

    Featured image: tfi_fashionincubator/Instagram

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    Collins Badewa

    A fashion and pop culture writer who watches a lot of TV in his spare time. At Style Rave, we aim to inspire our readers by providing engaging content to not just entertain but to inform and empower you as you ASPIRE to become more stylish, live smarter and be healthier. Follow us on Instagram @StyleRave_ ♥



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