Luxury retailer Saks Global Enterprises moved closer to exiting bankruptcy with a pair of agreements aimed at putting the company on firmer ground.
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Saks Global resolved a dispute with Simon Property Group over two leases the landlord sought to terminate and also secured court approval for a financing deal to raise up to $500M from creditors, Bloomberg reported.
Both agreements will be finalized and sent to the judge overseeing the Chapter 11 case soon, Saks Global attorney Debra Sinclair said during a court hearing Friday, according to the outlet.
Simon wanted to take over Saks Global locations at the Stanford Shopping Center in Palo Alto, California, and in Woodbury, New York, which is a Saks Off Fifth discount store, claiming the retailer is behind on rent and other fees. Saks Global previously claimed that shuttering operations at the two stores would prevent it from selling the leases to raise money for its creditors.
The settlement's details haven't been publicly revealed yet, so it is unclear what will happen to the pair of stores.
Saks Global got court approval for a separate deal with investors for financing, who can choose between purchasing preferred equity or lending the company cash, Bloomberg reported.
U.S. Bankruptcy Judge Alfredo Perez said the deal will help provide relief for the cash flow issues Saks faced when its bankruptcy case began, which were impeding its ability to acquire inventory, according to Bloomberg. Saks Global still needs court approval for its reorganization plan to reduce its roughly $3.4B debt load.
The company has shuttered dozens of stores, largely discount outlets, since the end of January as it refocuses on its luxury offerings.
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