Neiman Marcus, the 112-year-old storied luxury department store chain, has filed for Chapter 11 bankruptcy protection, the first department store chain to be toppled by the coronavirus pandemic.
The move, announced Thursday, follows the bankruptcy filing by J.Crew, which became the first major retailer to reorganize during the pandemic. Experts believe there will be more to come even as there are moves to reopen businesses in parts of the country like Texas and Florida.
“Prior to COVID-19, Neiman Marcus Group was making solid progress on our journey to long-term profitable and sustainable growth,” said Neiman Marcus Group CEO Geoffroy van Raemdonck in a statement. “However, like most businesses today, we are facing unprecedented disruption caused by the COVID-19 pandemic, which has placed inexorable pressure on our business.”
The company said it expects to emerge from bankruptcy by this coming fall.
Like other non-essential stores, Neiman Marcus temporarily closed its stores, which number 43, in mid-March. About 10 stores have been reopened for curbside pickup as some states have relaxed lockdown orders.
As part of the bankruptcy filing, the Dallas-based Neiman Marcus says it has secured $675 million in financing from creditors to keep operating during the restructuring, holding over two-thirds of the company’s debt. The bankruptcy filing is a big blow to Ares Management and the Canada Pension Plan Investment Board, which bought Neiman Marcus in 2013 for $6 billion.