Saks Global’s high-wire financial act is finally over. 

The company, which just over a year ago bought Neiman Marcus Group for $2.7 billion, filed for Chapter 11 bankruptcy late Tuesday — scrambling high-end retailing and leaving both vendors and lenders holding the bag.

Saks Global went to court with $1.75 billion in financing from a group of its bondholders, which will help keep the lights on during the process and, at long last, should provided more certainty for vendors that they’ll be paid for what they ship.

It was a fast fall and one sped up by a ton of debt, deteriorating relations with designers and a by a vision of the luxury department store model that never quite had enough money to take off.

Now, Geoffroy van Raemdonck, who was chief executive officer of Neiman Marcus Group when Saks Global bought the business, is taking the reins as chief executive officer and will steer the company through the complicated court process. He succeeds Richard Baker, who stepped down from his role as executive chairman and CEO of Saks Global.

WWD was first to report Saturday that Baker was out and that the company was negotiating with van Raemdonck.

“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 statement. “In close partnership with these newly appointed leaders and our colleagues across the organization, we will navigate this process together with a continued focus on serving our customers and luxury brands. 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 team that will work under van Raemdonck is starting to crystalize with the appointment of a couple luxury veterans. Darcy Penick has also been named president and chief commercial officer, overseeing stores, marketing, buying, digital, analytics and customer care. Lana Todorovich has been named chief of global brand partnerships. Already on board is Brandy Richardson, the retailer’s chief financial officer, who worked alongside van Raemdonck at Neiman’s.

There’s more than enough work to go around and things need to get rolling quickly, as vendors have not been shipping Saks Global and spring goods are due to hit the sales floor.

The company entered federal bankruptcy court in the southern district of Texas with over 10,000 creditors who now have to go through a judge to try to recoup what they’re owed. The initial court filing placed both the company’s assets and its debts as between $1 billion and $10 billion, but those numbers will be refined. The retailer’s debts include $2.2 billion in bonds the company took on to fund the Neiman’s deal and the additional $600 million in new money that was brought in during a refinancing in August.

The list of unsecured creditors features a who’s who of fashion at the very top, including:

The 30th largest unsecured credit, Vince Holding Corp., is owed $9.1 million.

While the highly anticipated bankruptcy filing has come, the ripples from the company’s failure are just starting to spread out.

The Saks + Neiman’s combo was the brainchild of Baker, who spent years using his real estate savvy and creative dealmaking to build a empire that ultimately succumbed to the laws of retail gravity.

That Saks Global was able to actually buy Neiman Marcus — a dream of Baker’s for more than a decade — was something of a marvel since Saks at the time was already not paying its bills, fraying its relation with vendors, who hoped the new debt that came with the transaction would be enough to set the business on its feet.

While bigger brands moved to a concession model at the retailer and retained ownership of their inventory, smaller designers have repeatedly been disappointed by Saks Global.

Marc Metrick, who was CEO of the retailer until just after New Year’s, worked tirelessly to bring the two businesses together — trying to calm vendor nerves, making painful cuts, trimming the staff and setting up a structure without a lead merchant.

The big cracks at Saks Global started to show last February, when Metrick told vendors that the company would start paying its bills on new orders with 90-day terms, instead of a 30-day turnaround, and that past due balances would be paid off in 12 monthly increments starting in July 2025.

“The expectation is that this provides the clarity and certainty you have been seeking,” Metrick wrote at the time. “To that end, we are looking forward to seeing the flow of merchandise return to normal levels so that we can begin to focus on driving our businesses together. In the absence of the normal flow of goods, we anticipate that we will have to make changes to our brand partner matrix.”

Saks Global did cut back on the number of brands it carried — with some walking away from the retailer and vice versa — but the goods never started flowing freely enough to let the retailer boost sales.

The vendors who have been waiting to be paid might well never see much of their money — a devastating result, especially for the smaller designers who have spent more than a year chasing Saks for payment. Secured lenders are first in line in bankruptcies and vendors owed trade payables often find themselves on the losing end. 

Now, the focus shifts to what comes next. Retailers often close stores during bankruptcy as it’s easier to break leases and the rest of the business will have to be reevaluated.

Amazon helped Saks Global buy Neiman’s and powers a Saks shop on its platform. The e-commerce giant has been working to truly break into the luxury market for years and, when it joined in the deal for Neiman’s, was seen as playing a long game to bolster its position and maybe take control of part of the retailer. If so, that game is now coming to an end.

Authentic Brands Group, which has a luxury joint venture with Saks Global, is also said to be keen on parts of the business and could make some kind of a play in bankruptcy court.

The business of Saks Global barrels on into a still uncertain. But the fashion industry — which is exhausted, angry, amazed and, in the case of some brands, close to bankruptcy themselves now — is still trying to understand exactly how the core of the luxury department store world in the U.S. simply unraveled.

Many will look back to the day in 2013, when Baker’s Hudson Bay Co.’s acquired Saks Fifth Avenue.

Even then, Baker made it loud and clear that he was determined to one day buy the Neiman Marcus Group and create a retail empire in the U.S. that would dominate the luxury market.

More guarded was the fact that Saks Fifth Avenue was already faltering, and wouldn’t be viable as a standalone business in the future. Saks could only survive through the consolidations, expense cuts, and greater buying power that a combined Saks-NMG entity could enable. Ultimately, the dire straits at Saks Fifth Avenue, as well as the debt from the acquisition, dragged both businesses down.

Saks Fifth Avenue and Neiman Marcus will at least be pared down, and Bergdorf Goodman could be sold off. A worst-case scenario is that the entire business gets liquidated, which sources suggest could happen due to the complexity of the bankruptcy proceedings and the extended range of bond holders, investors, landlords and vendors all of whom would be battling in court for some recovery.

Aside from its most recent issues — huge debt, deteriorating vendor relations, and the softening luxury sector — Saks has been set back by stronger competition, over expansion, too much management turnover, and strategy reversals since the Nineties.

When Baker arrived on the scene, the retailer was losing ground to competitors, primarily Neiman Marcus, but also to Bloomingdale’s, Nordstrom, and designer brands opening their own stores.

Saks and Neiman’s have been selling many of the same brands but Neiman’s was better at it, particularly with more expensive merchandise. Neiman’s had the edge, with its stronger service, talented team of selling associates with enduring client relationships, and a sharper luxury image consistent from door-to-door with deeper designer presentations.

Saks Fifth Avenue’s store count hasn’t been stable. In the Nineties, it embarked on a path of aggressive expansion opening smaller format “Main Street” and “resort” stores to cover more geography mainly in Florida, California and Texas, and capitalize on specialty stores going out of business.

The strategy didn’t work, and in 2004, Saks decided to close 11 stores — including five Saks Fifth Avenue locations in California. Saks still has several underperforming stores, a situation exacerbated by merchants’ inability to adequately stock locations with enough fresh merchandise due to deteriorating vendor relations.

It’s expected that in the near future more stores will close, possibly in markets where Neiman Marcus also operates. The two luxury retailers each have stores in Chicago, Atlanta, Boston, Las Vegas, and Beverly Hills. Within the last year or so, Saks did close stores in San Francisco, Palm Beach, Fla. In 2019 and 2020, Saks closed its women’s and men’s stores in Brookfield Place in lower Manhattan.

In March 2021, HBC split Saks Fifth Avenue’s website and store fleet into two separate companies, enabling the company to attract a $500 million investment from Insight Partners and accelerate e-commerce growth, and potentially take the online business public. However, after a couple of years, the website and store fleet were back together again.

While turnover in retail is not unusual and can be rapid, Saks has seen more than its fair share of management changes, leading to swings in merchandising and marketing strategies. Jeanne Daniel left Saks in 1998, after just seven months as executive vice president of merchandising. Christina Johnson was CEO from February 2000 to October 2003. Fred Wilson became president and CEO of Saks in January 2004, and left in January 2006. Steve Sadove, however, was CEO from January 2006 to November 2013, bringing some continuity to the business and setting it up for the sale to HBC.

Former Harrod’s chief merchant Marigay McKee became president of Saks in December 2013 but was gone by April 2015. She was replaced by Saks veteran Metrick, who in 2024 became Saks Global CEO. But in October, Metrick’s second-in-command, Emily Essner, president and chief commercial officer of Saks Global for about nine months, left the company, as part of a management shakeup shifting her responsibilities to other executives on the team. Yumi Shin, who had been chief merchandising officer of Bergdorf Goodman, left the store in October and has been recruited by Nordstrom. Shin is being sued by Saks for allegedly violating non-compete restrictions on her contract and sharing proprietary data.

Significantly, Saks Global acquired Neiman’s at a time when business at the two luxury nameplates was being impacted by the slumping luxury sector worldwide. Merging two retailers is always risky, involving resetting the management structure, integrating systems, blending separate corporate cultures – all time-consuming distractions from the day-to-day operations. It can even be fatal when both parties are not performing at their best. The merger of Sears and Kmart in 2005, when the chains were both ailing, eventually led to the liquidation of both.

Saks Global’ strategy for the last year revolved around “resetting” the luxury customer experience by intensifying personalization and bolstering customer service, inventory sharing between Saks and Neiman’s, and having enriched data, deeper customer insights and smoother interactions with consumers, and utilizing AI to a greater degree.

Now, the luxury department store company is going to get another new look — and everyone in fashion will be watching.