(Reuters) – The US luxury department store chain Neiman Marcus Group said Friday it has received court approval to access $ 675 million of its debtor-in-possession funding, which will allow business continuity company during Chapter 11 bankruptcy and will allow it to pay employees and vendors.
The provisional approval of his “first day motions” of the Houston Texas District Court of South District came a day after the company filed for bankruptcy, marking one of the collapses the most notorious to date among retailers forced to close temporarily. in response to the COVID-19 pandemic.
Neiman Marcus filed for bankruptcy in a Houston federal court and said Thursday that he had reached an agreement with creditors to finance $ 675 million in debtor in possession to aid operations while he was trying to reorganize.
The Dallas-based retailer plans to cede control to creditors in exchange for eliminating $ 4 billion in debt. Its debt currently stands at around $ 5 billion.
The company has said it expects to exit Chapter 11 proceedings early in the fall with a $ 750 million package from creditors who granted their initial bankruptcy loan.
Founded in 1907 when the Marcus and Neiman families opened their first store in Dallas, the retailer has expanded across the United States to become a fashion mainstay for celebrities and other affluent customers looking for bags hand, clothes and others.
Neiman Marcus has changed hands among private equity firms over the past 15 years, before being sold in 2013 to Ares Management Corp (ARES.N) and the Canada Pension Plan Investment Board in a $ 6 billion debt buyout.
Report by Kanishka Singh in Bengaluru; Editing by Raju Gopalakrishnan
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