Neiman Marcus Emerges From Chapter 11

Neiman Marcus Holding Company Inc. has completed its Chapter 11 bankruptcy protection process and emerged from one of the highest-profile retail collapses since COVID-19 began, the Dallas-based company disclosed.

The announcement comes a few weeks after it released its plan to exit Chapter 11. The company is eliminating more than $4 billion of debt and more than $200 million of interest expenses with no near-term maturities.

“While the unprecedented business disruption caused by COVID-19 has presented many challenges, it has also given us the opportunity to reimagine our platform and improve our business,” said Neiman Marcus Group CEO Geoffroy van Raemdonck in a statement. “We emerge from Chapter 11 as a stronger, more innovative retailer, brand partner and employer.”

He said the company’s new owners include PIMCO, a California-based global investment management firm, Davidson Kempner Capital Management LP, a global institutional alternative investment management firm headquartered in New York City and Sixth Street Partners, the San Francisco global investment firm. They see an opportunity to grow and support the retailer in issues of sustainability, van Raemdonck said.

The plan was approved by the U.S. Bankruptcy Court for the Southern District of Texas, Houston Division.

The new owners are funding a $750 million exit financing package that fully refinances the debtor-in-possession loan and provides Neiman Marcus with “significant” liquidity, the company said.

“They are also strongly committed to supporting our company on sustainability issues where we intend to be a leader within the industry,” van Raemdonck added. At the conclusion of this process, I remain profoundly impressed by the strength of Neiman Marcus and Bergdorf Goodman, the commitment of our associates, the unwavering support of our brand partners and the loyalty of our customers.”

The new owners are funding a $750 million exit financing package and the company has also secured a $125 million first in, last out (FILO) facility led by Pathlight Capital, the Massachusetts private credit investment management firm, the proceeds of which refinance existing debt and will provide liquidity to support the company’s ongoing operations and strategic initiatives. The financing is in addition to the liquidity provided by the $900 million asset-based lending led by Bank of America and a group of commercial banks.

With the support of its new shareholders and funds available from financing, Neiman Marcus said it expects to be able to execute on the strategic initiatives to ensure a long and successful future for Neiman Marcus.

Van Raemdonck will continue to serve as chief executive officer of Neiman Marcus Group, which had filed for bankruptcy protection in May.




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