Luxury department store chain Neiman Marcus Group has filed for bankruptcy protection, becoming the first department store chain and second major retailer after J Crew to be toppled by the coronavirus pandemic.
“Like most businesses today, we are facing unprecedented disruption caused by the COVID-19 pandemic, which has placed inexorable pressure on our business,” said Neiman Marcus Group CEO Geoffroy van Raemdonck in a statement.
The luxury retailer has entered into restructuring support agreement with a majority of its creditors.
Few of the company’s largest creditors that committed to fulfil US $ 675 million debtor-in-possession financing during the proceedings have also committed to fulfil a US $ 750 million exit financing package.
Christina Boni, Moody’s Investors Service’s senior credit officer, says that the plan will take off a considerable amount of debt off of the retail brand and will give them some financial flexibility and liquidity to get through the next few months.
Meanwhile, Neiman Marcus which operates 43 stores affirmed that it expects to emerge from bankruptcy by the coming fall and that there are no mass closings planned.
According to the Commerce Department’s report, US retail sales went through an unprecedented collapse in March, plummeting 8.7 per cent in the wake of the COVID-19 pandemic that forced an almost complete lockdown of businesses nationwide.
