Saks Declares Bankruptcy, Weighed Down By $2.7B Neiman Marcus Acquisition
The parent company of Saks Fifth Avenue and Neiman Marcus has filed for bankruptcy, weighed down by debt from its push to dominate big-box luxury retail.
Saks Global announced the Chapter 11 bankruptcy Wednesday along with a $1.75B financing commitment from a group of bondholders to keep the department stores running while it navigates the restructuring.
A new CEO was also named to guide the reorganization, which is likely to lead to store closures across Saks’ portfolio of luxury department stores.
It’s a stunning fall for the company, which operates Saks Fifth Avenue, Saks Off 5th, Bergdorf Goodman and, following a $2.7B acquisition in 2024, Neiman Marcus. That merger, backed by high-profile firms like Amazon and Salesforce, saddled the newly created Saks Global conglomerate with $2B in debt that, roughly a year later, helped push the firm into bankruptcy.
In its Chapter 11 petition, Saks disclosed between $1B and $10B in both assets and liabilities.
Saks missed a $100M debt service bill in December, after which the New York-based firm began negotiations with creditors about a potential reorganization. The missed interest payment followed more than a year of cash struggles for Saks that led to disputes with vendors, which impacted its store inventory and dragged on sales.
Geoffroy van Raemdonck, the former CEO of Neiman Marcus Group, will take the top spot at Saks from Richard Baker, who is leaving the role and his position as executive chairman, effective immediately.
"This is a defining moment for Saks Global, and the path ahead presents a meaningful opportunity to strengthen the foundation of our business and position it for the future," van Raemdonck said in a statement.
Saks said it plans to reevaluate its operational footprint as part of the reorganization. The company operates roughly 33 Saks Fifth Avenue locations, 36 Neiman Marcus stores, two Bergdorf Goodmans and around 70 Saks Off 5th discount locations.
Its real estate is likely to be viewed as an attractive slice of the company's assets. The Midtown Manhattan Saks Fifth Avenue flagship alone was valued at $3.6B in 2024.
The bondholder group offering $1B in debtor-in-possession financing includes Pentwater Capital and Bracebridge Capital, which also agreed to provide another $500M after Saks emerges from bankruptcy.
Some of Saks’ senior lenders, including asset managers MacKay Shields and BlackRock, were wary of extending the retailer a lifeline and didn’t participate in the bankruptcy financing negotiations, according to the Financial Times.
Darcy Penick was also named chief commercial officer, and Lana Todorovich was selected as the firm’s chief of global branded partnerships as part of the restructuring. Brandy Richardson is staying in place as chief financial officer.
"In close partnership with these newly appointed leaders and our colleagues across the organization, we will navigate this process together with a continued focus on serving our customers and luxury brands," van Raemdonck said.
Saks reported a $288M loss and a 13% decline in revenue for the quarter ending on Aug. 2. In June, the company raised $600M in new capital through a bond offering to cover another debt service shortage. Pentwater and Bracebridge also led that fund-raise, according to the FT.
S&P Global gave Saks' corporate bonds a CCC rating in September and further downgraded the debt last week from junk status to selective default following the missed payment as bankruptcy rumors grew louder.
The Chapter 11 filing in a Texas court is likely to wipe out billions of dollars in investor capital, and lawyers for Amazon have been quietly gaming out Saks’ restructuring options to determine the company’s exposure, the FT reported.
Saks said the $1B financing package will allow it to continue to pay employees and vendors while honoring customer incentive programs.
The luxury brand had been trying to raise cash last year. In December, it sold the land beneath its landmark Neiman Marcus stores in Beverly Hills and San Francisco for roughly $100M, The Wall Street Journal reported. It was also looking for a buyer willing to pay around $1B for a 49% stake in Bergdorf Goodman.
Saks is the first department store brand to declare bankruptcy since 2020, and its cash troubles come as luxury shoppers are increasingly propping up consumer spending. The retail sector was broadly resilient across 2025 and further bolstered by a holiday shopping season that beat analyst and retailer expectations.
