Amazon and Chanel Join Saks Creditors in Bankruptcy Representation
Amazon and Chanel have been appointed to the newly created creditors committee of Saks Global, a significant move in the luxury retailer’s bankruptcy proceedings. This committee, which comprises ten members, aims to enhance the influence of luxury brands in Saks’ restructuring efforts.
Members of the Creditors Committee
The committee includes several notable members from the luxury fashion industry and beyond:
- Chanel
- Amazon
- Ermenegildo Zegna NV
- Kering Americas
- Brookfield Properties Retail (landlord)
- A labor union representing Saks employees
- A logistics services supplier
- Pension Benefit Guaranty Corporation
Bankruptcy Filing Details
Saks filed for bankruptcy on January 13, reporting debts of $3.4 billion. Financial difficulties arose from a merger with Neiman Marcus, leading to cash shortages that hindered inventory replenishment.
The appointment of these high-profile creditors indicates their priorities. Saks owes Chanel $136 million, Kering $60 million, and LVMH $26 million, as revealed in court documents. The luxury retail sector has a vested interest in the outcome of this process, given Saks’ reliance on these brands for customer loyalty and store inventory.
Amazon’s Position
Amazon has expressed opposition to Saks’ proposed bankruptcy financing. This comes as it seeks to safeguard its $475 million equity investment and the revenue it receives from its “Saks on Amazon” partnership. Being part of the creditors committee may provide Amazon with strategic leverage during the bankruptcy proceedings.
Legal and Financial Implications
The newly formed committee serves as the official voice for all junior creditors, advocating for their interests. It will negotiate terms where Saks’ debts are typically considered less priority. Legal fees incurred by the committee will be charged to Saks during the bankruptcy case.
As proceedings continue under the supervision of the U.S. Trustee, the dynamics of this creditors committee will be pivotal to Saks’ financial restructuring and its relations with vital partners like Amazon and Chanel.
