US luxury retailer Saks Global has received approval from a Texas bankruptcy court for $1 billion in financing to support its turnaround plan. The decision was made by Judge Alfredo Perez during a hearing in Houston.
The news comes after Saks overcame objections from luxury brands and business partners. They had expressed concerns about the status of goods delivered to the group’s branches.
Brands like Dolce & Gabbana had resisted the luxury retailer’s financing proposals. They feared that lenders could assert security interests in products supplied to Saks on a commission basis, Reuters reported. Saks ultimately confirmed that the goods were not part of its other assets. Around $600 million of the new loan will be used for overdue payments to suppliers. About half of this is expected to be paid out in the next two weeks.
This is part of the overall financing package related to Saks’ ongoing bankruptcy proceedings, which amounts to approximately $1.75 million. The funds will be used to refinance previous debt and expand the credit limit of the company’s asset-backed credit facility.
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