Amazon's Objection Falters as Saks Secures Crucial $1.75 Billion Financing Amid Bankruptcy

A U.S. bankruptcy judge approved the initial phase of Saks Global's $1.75 billion financing, allowing the company to access $400 million despite Amazon's objections. This financial boost aims to stabilize Saks amidst its bankruptcy woes, enabling the retailer to honor its commitments to suppliers and employees.

A U.S. bankruptcy judge has granted preliminary approval for Saks Global's critical $1.75 billion financing arrangement, overriding significant objections from Amazon. This ruling permits Saks to draw on $400 million in new capital, a lifeline that aims to stabilize the luxury retailer amid its ongoing financial distress.

The court decision, delivered by Judge Alfredo Perez, marks a pivotal moment for Saks, which filed for bankruptcy under the crushing weight of $3.4 billion in debt. The challenge was exacerbated by a problematic merger with Neiman Marcus. Saks' restructuring officer emphasized the urgency of the funds to maintain operations, including paying vendors and its 17,000 employees.

Amazon argued vehemently against the proposal, citing a risk to its $475 million investment. However, the judge prioritized Saks' immediate financial requirements, ensuring it can avoid operational disruptions and resume inventory purchases to meet customer demands. Despite past financial struggles, Saks maintains that consumer interest remains strong, signaling hope for recovery.

(With inputs from agencies.)