Jan 14 (Reuters) – High-end department store conglomerate Saks Global filed for bankruptcy protection late on Tuesday, barely a year after a deal that aimed to create a luxury powerhouse.
One of the largest retail collapses since the pandemic, the development casts uncertainty over the future of U.S. luxury fashion.
Here are some key details of Saks’ Chapter 11 court filing listed below:
ASSETS AND LIABILITIES:
Saks Global listed its estimated assets and liabilities in the range of $1 billion to $10 billion, according to documents filed in the U.S. Bankruptcy Court in Houston, Texas.
The retailer had about $3.4 billion in funded debt obligations before the filing, including term loan credit agreements and notes issued, with a $275 million debt related to the Neiman Marcus acquisition set to mature in February, according to a court filing.
It said it operates about 70 full-line luxury locations, and owns or has ground leases on about 8.4 million square feet of U.S. real estate holdings and investments.
The company has also sought court approval to pay about $337.4 million to its vendors, with about $126 million to be paid early in the bankruptcy process, the filing showed.
KEY LUXURY UNSECURED CREDITORS:
The company estimated its number of creditors to be between 10,001 and 25,000. It includes several luxury brands, led by Chanel with around $136 million, followed by Gucci owner Kering with $60 million.
The world’s biggest luxury conglomerate, LVMH, was listed as an unsecured creditor at $26 million.
Its 30 largest creditors, who have unsecured claims and are not insiders, are collectively owed about $712 million, the company said in the filing.
NEW FINANCING:
Saks will receive $1 billion immediately in cash through a debtor-in-possession loan from an investor group, the company said.
In total, the company said it has secured a financing commitment of about $1.75 billion, including $1.5 billion from an ad-hoc group of senior secured bondholders and the rest through its asset-based lenders.
LEADERSHIP CHANGE:
Van Raemdonck, former Chief Executive of Neiman Marcus Group before the Saks Global acquisition in 2024, has replaced Richard Baker, who stepped down effective Tuesday.
Van Raemdonck will join alongside Chief Financial Officer Brandy Richardson, who held the same role during his time at Neiman Marcus, as per the company.
TOTAL EMPLOYEES:
Saks Global had about 16,830 employees, with roughly 87% of them full-time, the filing said. 22% of the total workforce is salaried, and the rest are hourly employees.
The company has sought court approval to pay about $140 million in compensation and benefits owed to its employees.
E-COMMERCE & GIFT CARDS:
Saks Global disclosed in a filing that it would wind down its e-commerce business and liquidate itself after evaluating strategic alternatives following revenue declines.
The online arm of Saks OFF 5th, called SO5 Digital, was spun off in 2021, with Saks Global owning 80% of the unit.
Saks Global has also requested that the court maintain its customer programs, including refunds and gift cards, during the Chapter 11 bankruptcy restructuring process.
The company said about $320 million remains unredeemed in prepaid gift cards purchased by customers, and disclosed outstanding liabilities of about $200 million related to the retailer’s refund and exchange program.
(Reporting by Angela Christy M and Neil J Kanatt in Bengaluru; Editing by Sriraj Kalluvila and Anil D’Silva)
