Saks Fifth Avenue is entering a new chapter after its parent company, Saks Global, officially filed for Chapter 11 bankruptcy protection late Tuesday, January 13, less than a year after completing its high-profile acquisition of Neiman Marcus.
Saks Global was formed in 2024 when Hudson’s Bay Company finalized a $2.65 billion deal to acquire Neiman Marcus, pitching the merger as a way to create a luxury retail powerhouse with greater leverage over brands and a renewed pull for in-store shoppers.
But according to CNN, the combined company struggled to generate the efficiencies needed to offset its heavy debt load, leaving it vulnerable in an already challenging retail environment.
The filing follows months of warning signs. Saks reportedly fell behind on vendor payments, creating supply issues that affected inventory levels and strained key relationships.
Earlier this month, then-CEO Marc Metrick stepped down after the company missed a major debt payment. Executive chairman Richard Baker briefly assumed the CEO role before returning to his previous position.
Former Neiman Marcus chief Geoffroy van Raemdonck has now been appointed CEO and will lead the company through the bankruptcy process.
“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,” van Raemdonck said in a company statement. He added that the leadership team plans to focus on supporting customers and brand partners as it works through the restructuring.
The timing of the merger proved difficult. Many shoppers have grown frustrated with luxury retail, citing higher prices and declining quality, while others are bypassing department stores altogether in favor of buying directly from brands online. Broader economic uncertainty has also weighed on consumer confidence, making discretionary spending less predictable.
Retail analyst Neil Saunders of GlobalData said the outcome was largely inevitable given the deal's financial structure. Saks’ acquisition of an already debt-heavy Neiman Marcus made bankruptcy the “likely destination,” he noted, adding that the most surprising part was how quickly the situation deteriorated.
Despite the filing, Saks Global says operations will continue. The company announced it has secured $1 billion in debtor-in-possession financing to support day-to-day business during bankruptcy, with an additional $500 million committed upon emergence.