Pedestrians walk past a Saks Fifth Avenue store in chicago, Dec. 30, 2025.
Chicago, January 2, 2026 – saks Global, the luxury retailer, is scrambling to secure up to $1 billion in financing as it prepares for a potential Chapter 11 bankruptcy filing, according to sources familiar with the matter. The company’s ability to stay afloat hinges on securing a “debtor-in-possession” loan, a lifeline that would fund operations during reorganization.
financing Falls Through for Luxury Retailer
Investors are hesitant to back Saks amid concerns about a successful restructuring.
- saks Global is facing a potential bankruptcy filing after missing a debt payment.
- Securing a $1 billion debtor-in-possession loan is proving difficult due to investor skepticism.
- The retailer’s troubles stem from a heavily debt-financed acquisition of Neiman Marcus and a slowdown in the luxury market.
- Liquidation remains a distinct possibility if financing cannot be secured.
However, investors have shown limited interest, skeptical that Saks can successfully reorganize and repay the loan, sources said. While DIP lenders typically have priority in bankruptcy proceedings, the risk of not fully recouping their investment is deterring potential funders.
The 159-year-old department store, which now owns Neiman Marcus and Bergdorf goodman, is a well-known destination for luxury brands like Chanel and Dior, alongside contemporary labels like Good American. Saks Global operates over 70 full-line stores and approximately 100 off-price locations.
Since missing an interest payment to bondholders last month, only a “limited number” of investors have expressed interest in the DIP loan, while many others have declined to participate, sources revealed. Saks declined to comment on investor interest in its fundraising efforts.
What happens if Saks can’t get a DIP loan? Without the necessary funding to cover essential expenses like payroll, rent, and inventory, a Chapter 7 liquidation becomes increasingly likely, possibly ending one of the most iconic department stores in history.
Experts suggest that any firms willing to invest at this stage would likely be liquidators with investment arms or alternative asset managers specializing in distressed retail. Even these investors have reportedly hesitated to commit to Saks’ DIP loan.
Liquidation is one of several potential outcomes, but the inability to secure a DIP loan would significantly increase its likelihood. A successful Chapter 11 filing would offer Saks a chance to reorganize and potentially attract a buyer. Failure to secure financing could lead to a Chapter 7 bankruptcy, resulting in the complete liquidation of the company.
The fate of Saks’ flagship Fifth Avenue store, considered its most valuable asset, hangs in the balance. The company is also reportedly in discussions with liquidators regarding a number of stores already slated for closure,though not a full chain liquidation at this time.
Saks’ current predicament stems from its $2.7 billion acquisition of rival Neiman Marcus in 2024, a deal largely financed with debt. The merger aimed to create a luxury retail powerhouse through cost streamlining and improved vendor negotiations.
Instead, Saks has faced challenges paying vendors on time, leading to inventory shortages and declining sales.A broader slowdown in the luxury market, which has experienced stagnating growth in recent years, has further exacerbated the situation.
