Saks Global Enterprises Files for Bankruptcy Relief

Saks Global Enterprises, the luxury retail conglomerate that owns iconic brands such as Saks Fifth Avenue, Neiman Marcus, and Bergdorf Goodman, filed for Chapter 11 bankruptcy protection because it became overwhelmed by unsustainable debt obligations, weakening sales, and operational challenges. The company’s financial strain peaked in late 2025 when it failed to make a key interest payment of more than $100 million, signaling that its cash flow could no longer support its massive debt load. This triggered negotiations for debtor-in-possession financing and ultimately led to the bankruptcy filing as a means to restructure and stabilize the business under court supervision.

One major reason for the bankruptcy was the enormous debt incurred from aggressive expansion and mergers, especially the expensive acquisition of Neiman Marcus in 2024 for about $2.7 billion. That deal was intended to create a powerful luxury retail force but instead left Saks Global with billions in debt that its operating profits could not service, particularly as sales softened. Coupled with a broader slowdown in luxury consumer spending, this heavy leverage drained the company’s liquidity and made interest payments increasingly difficult to sustain.

At the same time, Saks’ operating performance deteriorated, which deepened its liquidity problems. The company reported declining revenue and widening adjusted EBITDA losses, with one recent quarter showing a 13.1% drop in sales and an expanded loss compared with the year before, even as it carried roughly 1.9 billion dollars of inventory on its balance sheet. As growth in the luxury market slowed and the expected benefits from combining Saks and Neiman Marcus failed to materialize, cash generation from the business was not enough to support the large interest burden and everyday expenses like rent and payroll.

In combination, these problems left Saks Global Enterprises with a capital structure and business model that no longer worked: a highly leveraged balance sheet from the Neiman Marcus deal, declining sales and mounting losses, and a breakdown in vendor relationships that led to empty shelves and shrinking cash flow. When the company missed a large interest payment and struggled to secure debtor‑in‑possession financing to keep operating, Chapter 11 bankruptcy became the mechanism it chose to try to reorganize its debts, stabilize relationships with creditors and vendors, and decide whether parts of the business could survive under new owners.