Willkie Farr & Gallagher and Haynes Boone are representing the US’s largest luxury retailer Saks Global in its bankruptcy protection filing following debt struggles and sliding sales just a year after it completed a $2.7bn merger with Neiman Marcus.
The Willkie team is led by partners Gregory Astrachan, Matthew Feldman, Debra Sinclair, Robin Spigel and Charlotta Chung.
Haynes Boone’s team includes partners Kelli Norfleet, Ken Kattner and Arsalan Muhammad.
To many observers, the Saks bankruptcy reflects broader challenges for traditional brick-and-mortar luxury retail amid shifting consumer habits, high debt levels and competitive pressure from online and direct-to-consumer brands.
In December, the company, which includes iconic brands Saks Fifth Avenue and Bergdorf Goodman, missed a $100m interest payment to its bondholders but will remain in business while it reorganises with $1.75bn in new financing during Chapter 11 proceedings.
The $1.75bn package consists of $1.5bn from the company’s senior secured bondholders, as well as a $240m loan distributed in increments from the company’s asset-based lenders. Once its filing is approved, the company said some of the funds will help pay for its operations and turnaround initiatives, adding that the bondholders have also committed to $500m later this year.
Former Neiman Marcus chief Geoffroy van Raemdonck was named CEO, replacing Richard Baker, who was in the job for less than two weeks. Raemdonck plans to expand Saks Global’s leadership team, bringing on more former Neiman Marcus Group executives to serve as president, chief commercial officer and other roles.
“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,” said van Raemdonck. “I look forward to serving as CEO and continuing to transform the company so that Saks Global continues to play a central role in shaping the future of luxury retail.”
The company filed four Chapter 11 bankruptcy petitions on 13 and 14 January in the Southern District of Texas. Listed as debtors in the documents are Saks Global Holdings LLC, Saks Global Investments Inc, Saks Global Investor LP and Saks Global Enterprises LLC. In the documents, Saks Global said that the company owes between 10,000 and 25,000 creditors and has an estimated $1bn to $10bn in assets and liabilities.
Saks Global is the largest multi-brand luxury retailer in the world. Its retail portfolio includes 70 full-line luxury locations, additional off-price locations and five distinct e-commerce experiences.
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