BY EMMANUEL OGBONNA
Saks Global, the owner of luxury department store Saks Fifth Avenue, has filed for Chapter 11 bankruptcy protection as mounting debt, intensifying competition and a prolonged slowdown in luxury spending squeeze the retailer just over a year after it acquired rival Neiman Marcus.
The New York–based company said Wednesday it had secured approximately $1.75 billion in financing as part of the bankruptcy filing in the Southern District of Texas, allowing it to continue operating while it restructures its balance sheet. Saks Global emphasized that its stores will remain open throughout the process and that customer loyalty programs will continue to be honored. The company also said it plans to pay employees and suppliers in the ordinary course of business.
Saks Global operates about 33 Saks Fifth Avenue stores and 36 Neiman Marcus locations across the United States, along with two Bergdorf Goodman stores in New York and roughly 70 Saks Off 5th discount outlets. Together, the brands represent one of the largest footprints in the U.S. luxury department store sector.
“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,” said Geoffroy van Raemdonck, who assumed leadership this week after being named chief executive officer. He replaced Richard Baker, the company’s executive chairman, who had taken on day-to-day control following the departure of former CEO Marc Metrick earlier this month.
The bankruptcy filing marks a dramatic turn for a company that, in the summer of 2024, announced plans to acquire Neiman Marcus for $2.65 billion. At the time, the deal was billed as a bold effort to consolidate a fragmented luxury retail market that had been under pressure from online competitors and from luxury brands increasingly selling directly to consumers through their own stores and websites.
Instead of stabilizing the business, the acquisition compounded Saks Global’s already heavy debt load just as demand for high-end goods began to weaken. The company had struggled to keep up with payments to vendors even before the deal closed, and by last year it began extending payment terms, straining relationships with luxury brands and suppliers.
Retail analysts say the Neiman Marcus acquisition significantly increased the risk of a bankruptcy filing, though many were caught off guard by how quickly the company reached that point. Neil Saunders, managing director of GlobalData Retail, said the transaction relied on complex financial arrangements that ultimately constrained the company’s ability to execute its strategy.
“Behind the glossy facade, the deal was an entanglement of complex financial engineering that made it impossible for the group to execute their stated vision,” Saunders wrote, adding that the broader environment for luxury department stores has become increasingly unforgiving.
Indeed, even retailers with stronger balance sheets are facing headwinds. Global luxury goods sales are expected to decline for a second consecutive year as consumers, unsettled by economic uncertainty and higher living costs, rein in discretionary spending, according to a Bain & Co. study released late last year.
The struggles of Saks Global come amid a broader reckoning for traditional department stores. Hudson’s Bay, Canada’s oldest company, began liquidating all but six of its stores in March 2025. Neiman Marcus itself sought bankruptcy protection in 2020 during the height of the pandemic, while Lord & Taylor filed for bankruptcy that same year and later shuttered all physical locations to operate online only. Nordstrom, another century-old retailer, agreed last year to go private in a $6.25 billion deal. Macy’s has recently shown signs of improvement, but only after closing underperforming stores as part of a sweeping turnaround plan.
Vendors that rely heavily on Saks Global are now watching the restructuring process closely, wary of potential disruptions. Gary Wassner, chief executive of Hilldun Corp., a firm that provides financial guarantees to apparel suppliers, said many brands are deeply concerned about outstanding and future orders.
“They’re very nervous, very concerned, very worried about spring deliveries for merchandise that they’ve already produced,” Wassner said. He noted that some suppliers were unable to complete deliveries for the fourth quarter of 2025 because of payment issues and are now holding unsold inventory.
According to Wassner, Saks Global accounts for as much as 40% to 50% of the business for some suppliers. Hilldun advised its clients to stop shipping to Saks last month due to the uncertainty, he said, adding that about $130 million in spring merchandise orders are ready but awaiting payment assurances.
Saks Global said its restructuring plan is supported by $1.5 billion in financing commitments from certain creditors, along with an additional $240 million in incremental liquidity from lenders. The company said this funding will provide sufficient cash to maintain operations during the bankruptcy process.
The filing adds to a growing list of retailers seeking court protection after years of elevated inflation eroded consumer purchasing power and pushed up operating costs. While Americans continue to spend, a widening range of companies has been tipped into bankruptcy, including mall-based accessories chain Claire’s and craft retailer Joann.
Bankruptcy filings have been rising steadily across the economy. Data from S&P Global Market Intelligence show that 785 companies filed for bankruptcy last year, the third consecutive annual increase and the highest total since 2010. Retailers accounted for the second-largest share of those filings, underscoring the continued strain on the sector as consumer habits and competitive pressures continue to evolve.
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