High-end retail giant Saks Global has filed for bankruptcy protection, marking one of the most significant retail collapses during the pandemic. This move comes shortly after a merger that aimed to consolidate Saks Fifth Avenue, Bergdorf Goodman, and Neiman Marcus. Despite the uncertainty surrounding the future of the iconic luxury brand, Saks has assured that its stores will continue operating following the finalization of a $1.75 billion financing package and the appointment of a new CEO.
The impact of the COVID-19 pandemic, coupled with increased competition from online retailers and brands selling directly, has taken a toll on Saks, leading to financial struggles such as difficulty in paying vendors who have started withholding inventory. Former Neiman Marcus CEO Geoffroy van Raemdonck will take over from Richard Baker, who initiated the acquisition strategy that burdened Saks Global with debt. Documents filed in U.S. Bankruptcy Court estimate the company’s assets and liabilities to be between $1 billion and $10 billion.
The bankruptcy filing is aimed at providing Saks with the opportunity to restructure its debts with creditors or seek new ownership. Failure to do so may result in closure. The company emphasized in its filing that the issue lies in inventory availability and vendor confidence, not a lack of demand for luxury goods. The Neiman Marcus acquisition, which occurred at a time when luxury sales were slowing down globally, added to Saks Global’s financial challenges.
To address its financial woes, Saks raised $600 million and restructured debt in 2025. However, persistent issues like missed vendor payments and inventory disruptions led to severe liquidity constraints heading into 2026. A lack of stocked shelves may have driven customers to competitors like Bloomingdale’s, further intensifying the pressure on Saks Global.
The company recently sold the real estate of the Neiman Marcus Beverly Hills flagship store and was exploring selling a minority stake in Bergdorf Goodman to reduce debt. A new financing deal worth $1 billion is set to provide immediate cash through a debtor-in-possession loan, with additional financing available once the company exits bankruptcy protection. Notable luxury brands, including Chanel and Gucci owner Kering, are among the unsecured creditors listed in the court filing.
Industry experts foresee luxury brands reducing their dependence on department stores and focusing more on owned channels and strategic partnerships. The bankruptcy filing marks a significant turn of events for Saks Global, which was formed through the consolidation of renowned American fashion names and has been a key player in the luxury retail sector for over a century.