Saks Global, a prominent high-end department store conglomerate, has filed for bankruptcy protection, marking one of the largest retail collapses during the ongoing pandemic. This development follows a recent merger involving Saks Fifth Avenue, Bergdorf Goodman, and Neiman Marcus. Despite the uncertainties surrounding the future of the iconic luxury brand, Saks has announced that its stores will continue operating for the time being. The company secured a $1.75 billion financing package and appointed a new CEO to navigate through these challenging times.
The impact of the COVID-19 pandemic, coupled with increased competition from online retailers and direct brand sales, has taken a toll on Saks’ financial stability. The company faced difficulties meeting vendor payments, leading to inventory shortages. Former Neiman Marcus CEO Geoffroy van Raemdonck will now lead Saks Global, taking over from Richard Baker, who initiated the acquisition strategy that resulted in significant debt for the company.
Saks Global’s assets and liabilities are estimated to fall within the range of $1 billion to $10 billion, as per documents filed in U.S. Bankruptcy Court. The bankruptcy filing aims to provide the luxury retailer with the space to restructure debts or seek new ownership. The company emphasized that the main challenges lie in inventory availability and vendor confidence, rather than a lack of demand for luxury goods.
The acquisition of Neiman Marcus added further debt to Saks Global at a time when luxury sales were slowing globally. The company, which employs approximately 17,000 individuals, previously raised $600 million and restructured debt in 2025 to address financial issues. However, persistent vendor payment delays and inventory disruptions led to severe liquidity constraints heading into 2026.
To address its financial woes, Saks Global recently sold the real estate of the Neiman Marcus Beverly Hills flagship store and explored selling a minority stake in Bergdorf Goodman. The company finalized a new financing deal, including a $1 billion cash infusion through a debtor-in-possession loan and additional financing options post-bankruptcy protection exit.
Several luxury brands, such as Chanel and Kering, are listed as unsecured creditors in the bankruptcy filing, highlighting the widespread impact of Saks Global’s financial struggles. Industry experts anticipate a shift in luxury brands’ strategies, emphasizing owned channels and curated partnerships over traditional department stores.
Richard Baker’s strategic moves, including the takeover of Neiman Marcus by Hudson’s Bay Co. and the subsequent creation of Saks Global, have reshaped the American high fashion landscape. However, the current bankruptcy filing underscores the challenges faced by traditional luxury retailers in adapting to evolving consumer preferences and market dynamics.