Saks Global has entered into a Restructuring Support Agreement with an ad hoc group of its senior secured bondholders, who have committed to provide US$500m in exit financing upon the company’s emergence from Chapter 11.
Saks Global filed for Chapter 11 bankruptcy protection after debts weighed on the business from its $2.7bn acquisition of department store chain Neiman Marcus in 2024.
The Restructuring Support Agreement has been described by Saks Global as a “critical milestone” in its Chapter 11 process, with the business expected to emerge this summer.
The company added that it remains on track to meet all of its case milestones, with Saks Global’s sales and inventory results continuing to “outperform”.
This, along with the committed capital the company has secured, aims to support the business to have sufficient liquidity to operate throughout the restructuring process.
"Achieving this important milestone underscores the progress we are making on our transformation and reflects our capital partners' confidence in our go-forward vision, guided by our relentless devotion to the luxury customer," said Geoffroy van Raemdonck, CEO of Saks Global.
"As we advance the restructuring process and position Saks Global for the future, our focus remains on strengthening our brand partner relationships, and delivering an expertly curated product assortment and personalised service for our luxury customers across Saks Fifth Avenue, Neiman Marcus and Bergdorf Goodman."
Upon its emergence from Chapter 11, Saks Global claimed it would be well positioned to drive profitability through a stable financial foundation with a right-sized capital structure.
This also includes sufficient liquidity to invest in key areas of the business to support its long-term growth.
The business aims to achieve an integrated retail model with an optimised store footprint of the best-performing locations in markets with a high concentration of luxury customers.
"In a short period of time, we have taken decisive actions and made meaningful progress in stabilising the business and strengthening our relationships with brand partners," added van Raemdonck.
"While it will take time to fully realise the benefits of this progress, our sales and inventory results continue to outperform our internal plans.
“This, along with the committed capital we have secured, provides us with sufficient liquidity to complete a successful restructuring and advance our ongoing transformation to ensure a strong future for Saks Global."
The majority of Saks OFF 5th locations (57 in total) have already closed, as have all five remaining Neiman Marcus Last Call locations.
As part of its restructuring, Saks Global has accessed $825m of a total $1.75bn committed capital, which has improved its liquidity and enabled it to fund new orders with brand partners.
Estée Lauder Companies, Beiersdorf and Puig were revealed to be among the beauty companies owed millions of dollars by the US luxury retailer in court filings earlier this year.