Neiman Marcus, Retail Brand Going To File Bankruptcy
Sources reveal that Neiman Marcus is going to file for protection against bankruptcy as the company is facing major downfall during the coronavirus crisis. The company will file bankruptcy protection, possibly this week, become the first departmental store of the United States to succumb to the economic drop out that brings a hard time for the company to work.
The pandemic caused the temporary shut down of the 43 departmental stores in the different locations, including two dozen stores of the Last Call and about two Bergdorf Goodman buildings situated in New York.
Neiman Marcus is negotiating for the loan of about hundreds of dollars with the creditors that help them to continue their operations for the bankruptcy procedure, say the sources. The company has furloughed about 14,000 employees, as there are no sources of income.
Standard & Poor’s, a credit rating institution, says that the total borrowings of the Neiman Marcus is about $4.8 billion.
Sources reveal that the company skipped the payment of its million dollars debt last week.
Sources say that the bankruptcy protection filing is confidential, the company, however, declined for any comment, and CPPIB officials even didn’t immediately give any response to the request.
However, there are other store operators who have also closed during the coronavirus crisis are trying to avoid such situations as much as possible like Neiman Marcus. Other companies like Macy’s Incorporation are securing their financial condition, by borrowing some help from their real estate investments.
The company has avoided bankruptcy filing from last year, as it was not capable of paying its creditors. Last year the bondholder of the company sued Neiman Marcus by claiming that the owner robed the investor by taking their e-commerce website beyond the creditor’s reach.
Last week, a note published by the analyst of Standard and Poor’s saying that “In light of the significant headwinds stemming from the coronavirus pandemic and our expectation for a U.S. recession this year, we believe the company’s prospects for a turnaround are increasingly low,” The analyst further added that “We continue to view its capital structure as unsustainable,”