Department store Saks in financial dire straits
Major US department store Saks is in a financial mess, having missed a $100 million interest payment last month.
The retailer, which stocks watch brands including Bvlgari, TAG Heuer and Versace, is apparently negotiating for extra time to pay with its creditors.
A potential Chapter 11 filing (which would mean the business would continue to operate while it works out a plan to pay back its creditors) is on the cards and could be supported by a $750 million Debtor-in-Possession (DIP) loan, providing the liquidity necessary.
The financial crisis comes just a year after a multi-billion dollar expansion aimed at acquiring rival department store Neiman Marcus, a move that left the company exposed to poor sales performance.
In response to the grim financial news, executive chairman Richard Baker has stepped back into the CEO role following Marc Metrick’s recent exit.
