June 26 (Reuters) – Luxury retailer Saks Global on Friday emerged from Chapter 11 bankruptcy after nearly five months with less than half of its previous stores and a quarter of its debt.
The company, home to three of America’s most iconic retail brands — Saks Fifth Avenue, Neiman Marcus and Bergdorf Goodman — will operate under the name Exemplar Luxury Group (ELG) and will focus on luxury retail, it said in a statement.
ELG’s reconstituted board will include two representatives each from investment firms Pentwater Capital Management and Bracebridge Capital that partnered with Saks during the restructuring process, the company said.
The company added that its debt had been reduced by nearly 75% as part of the restructuring, which also wiped out its equity.
Saks Global emerged from bankruptcy with 49 stores, having closed 62 of its off-price stores, including 57 of its Saks OFF 5th and all five Neiman Marcus Last Call stores.
In March, it also closed 12 Saks Fifth Avenue stores and three Neiman Marcus locations. It had entered bankruptcy with 33 Saks Fifth Avenue locations.
Saks Global also ended its partnership with early investor Amazon to sell its products on the e-commerce platform during the restructuring. The partnership had faced pushback from top luxury brands who feared that selling on a mass-market site would dilute their image.
ILL-FATED MERGER
Saks Global’s $2.7 billion merger with Neiman Marcus in December 2024, orchestrated by real estate tycoon and former Saks CEO Richard Baker, was designed to create a luxury powerhouse.
However, it burdened Saks with debt at a time when global luxury sales were slowing, complicating an already difficult turnaround.
The result was cash shortfalls and inventory issues at its stores and strained relationships with critical vendors such as Chanel, LVMH and Kering.
After struggling with weak sales for more than a year, piling up debt and defaulting on vendor payments, Saks filed for bankruptcy protection in January.
At the time, it had $3.4 billion in debt, including more than $337 million owed to critical suppliers such as French luxury brand Chanel and Gucci owner Kering.
The company got final court approval for a $1 billion bankruptcy loan in February and planned to use $600 million of that financing for vendor payments.
Geoffroy van Raemdonck — who had led Neiman Marcus through its 2020 bankruptcy — was tapped as Saks Global CEO at the start of the proceedings.
He will lead ELG and will also be a member of the board along with former Ulta Beauty CEO Dave Kimbell and Philippe Schaus, former global CEO of Moët Hennessy, the wine and spirits division of luxury group LVMH.
(Reporting by Juveria Tabassum and Koyena Das in Bengaluru; Editing by Sriraj Kalluvila and Sahal Muhammed)
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