A Saks Global bankruptcy filing is expected by early-to-mid next week, with the struggling luxury retailer submitting a reorganization plan involving scores of store closures across the portfolio.
“The plan will reduce the number of unproductive Saks Fifth Avenue, Neiman Marcus and Saks Off 5th stores,” said one source, who requested anonymity.
According to multiple sources, at least 20 Saks Fifth Avenue and Neiman Marcus locations have been identified for closure. There are 33 Saks Fifth Avenue stores, 36 Neiman Marcus stores, two Bergdorf Goodman doors, and a few Last Call stores. The company also operates the Horchow catalogue business as well as the Saks Off 5th off-price concept.
Another source told WWD that Saks Global “remains engaged in discussions with its key financial stakeholders and is exploring all potential options. No decisions have been made.”
Last year, Saks officials indicated that up to 10 Saks Fifth Avenue stores would close and that they were closely assessing locations after the retailer merged with Neiman Marcus in December 2024. There are eight shopping centers where Saks Fifth Avenue and Neiman Marcus both operate, including the Houston Galleria, Town Center at Boca Raton, Bal Harbour Shops in Miami and The Somerset Collection in Troy, Mich. It’s probable that one of the two luxury nameplates in those centers shuts down.
If a Chapter 11 reorganization is approved, among the locations likely to survive are Bergdorf Goodman and the Saks Fifth Avenue Manhattan flagship.
According to sources, among Saks Fifth Avenue’s weaker locations are in St. Louis; Las Vegas; East Rutherford, N.J.; Huntington Station, Long Island; Raleigh, N.C.; Birmingham, Ala.; San Antonio and Austin, Texas; Beachwood and Columbus, Ohio; Tulsa, Okla.; Orlando and Boca Raton, Fla., and South Coast Plaza, Costa Mesa, Calif.
However, Saks is said to have healthier stores in Houston; Naples and Sarasota, Fla.; Tysons Corner, Va; Beverly Hills; Philadelphia; Boston; Chevy Chase, Md; Bal Harbour, Fla.; Atlanta, and Manhattan.
Neiman’s top stores include locations in Northpark, Dallas; Beverly Hills, Newport Beach and San Francisco, Calif.; Atlanta; Chicago, and Houston. Neiman’s has a more curated audience and a stronger team of selling associates. The weaker Neiman’s units are said to be in San Diego and Palo Alto, Calif.; Denver; and Tampa Bay.
It is also believed that as many as 50 Saks Off 5th stores could close, which is more than half the off-price chain’s brick-and-mortar fleet. In November, WWD reported that Off 5th would close nine locations beginning this month. t the time, Saks Global indicated that its decision to close Off 5th stores followed an extensive analysis of the fleet, including market dynamics, lease expirations, customer behavior and long-term business potential. There are currently 71 Saks Off 5th locations.
Any reorganization plan proposed would require the approval of bankruptcy court.
A total liquidation of Saks Global is also a possibility, but Richard Baker, executive chairman and chief executive officer, has been working hard to line up debtor-in-possession (DIP) financing to keep the busniess operating, with him hoping to continue at the helm. Baker, who acquired Neiman’s in a $2.7 billion deal, became CEO this year after Marc Metrick and company fell behind on its debts, missing a more than $100 million interest payment on its bonds.
A third party could swoop in to buy Bergdorf Goodman, or other prime Saks Global retail sites, to keep the luxury retailer alive. Bergdorf’s real estate is owned by the Goodman family which has for decades collected rent on the building, though there has been recent murmurings that younger members of the Goodman family would be open to a sale of the property, which would make it much more attractive for a purchaser. LVMH Moët Hennessy Louis Vuitton has long been interested in Bergdorf’s, as has Jeff Bezos of Amazon.
Baker had been pursuing Bezos to help finance Saks Global through a bankruptcy, but that didn’t work out. Sources said they met several times in the U.S. and in Europe, but one person close to the situation denied that such meetings took place.
“No one wants a liquidation. This is expected to be a regular bankruptcy,” said the source.
As first reported by the Wall Street Journal, a group of bondholders led by Bracebridge Capital and Pentwater Capital is proposing a $1.25 billion debtor-in-possession loan to fund Chapter 11 proceedings, and would take control of the company away from Baker. WSJ also reported that Pacific Investment Management Company (PIMCO) has a competing $1.5 billion debtor-in-possession loan. PIMCO was among the owners of the Neiman Marcus Group that sold NMG to Saks Global for $2.7 billion in December 2024.
Saks Global stores have been depleted of merchandise as many vendors have for weeks not been shipping Neiman’s or Saks or pulling merchandise out of the stores.
“The real question is what’s the business plan for Saks Global?” one retail expert asked. “How is the business going to be run differently. What’s the plan for store closings? Who is going to run the business? There’s going to be a lot of lawsuits over this.”
