Neiman Marcus could file for bankruptcy this week

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The retailer has closed all of its Neiman Marcus, Bergdorf Goodman and Last Call stores until at least the end of this month due to the pandemic.

Photograph by Scott Olson/Getty Images

Neiman Marcus Group could become one of the first major retailers to file for bankruptcy due to the coronavirus shutdown.

The high-end department store is considering a filing as soon as this week, according to a Reuters report citing people familiar with the matter. The retailer is also said to be negotiating with creditors to obtain financing so that it can maintain certain operations during a restructuring.

It has closed all of its Neiman Marcus, Bergdorf Goodman and Last Call stores until at least the end of this month to stop the spread of the coronavirus. The Dallas-based company continued to sell apparel and products to customers online, and says it has accelerated launch of a “new sales and styling tool to facilitate distance selling”.

Neiman Marcus is privately held and has $4.8 billion in debt, according to S&P Global Ratings. The credit rating firm downgraded the company last week to CCC-, CCC’s lowest pre-default rating. Analysts called the retailer’s debt burden onerous and said the business would likely have to restructure. The retailer is likely worth about $2.2 billion before bankruptcy administration costs, S&P said.

Write to Alexandra Scaggs at alexandra.scaggs@barrons.com

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