NEW YORK (CBSDFW.COM/AP) – The coronavirus shutdown has hit Neiman Marcus so hard that the 112-year-old storied luxury department store chain is seeking Chapter 11 bankruptcy protection.
According to a report by Reuters, Neiman Marcus Group is carrying almost $5 billion in debt and was forced to close its stores and furlough most of its employees due to the pandemic. With so much debt, S&P Global Ratings even downgraded the company to CCC — the lowest rating before default.
It is the second major retailer to do so and the first department store to be toppled by the coronavirus pandemic.
As part of the bankruptcy filing, 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 filing comes as department stores were already in a weakened state. Now, the coronavirus pandemic has placed them further in peril.