While attending Pitti Uomo, a friend asked if I had heard the news about Saks. Finally trying to find a way out of misery, the famed retailer filed for Chapter 11 Bankruptcy. This was no surprise, it was a matter of when. A misguided merger with rival Neiman Marcus left the New York chain washed in debt with no clear plan. The question is: Now what happens?
Debtors and vendors are left holding the bucket. LVMH, Chanel and Kering are owed $225 million. With a $1.75 billion restructuring deal, the famed luxury destination may live to see another day, but for how long? The list of creditors is long. Will they trust Saks in the future given the current climate? Customers have abandoned stores, choosing instead Bloomingdales and Nordstrom. With so many negative headlines, it will be hard for the 159 old chain to lure shoppers back.
At the time of writing, another legal challenge arose from Amazon. The Internet giant is disputing the agreement claiming its share in the company is now worthless.
Former Neiman Marcus head Geoffroy van Raemdonck is being mentioned as heading the company. This moves seems more of a way to steady the ship than a real visionary plan, something Saks lacked for along time.