High-end retailer Neiman Marcus files for bankruptcy protection amid virus outbreak

The United States luxury department store chain Neiman Marcus Group (NMG.A) applied for bankruptcy protection in a federal court in Houston on Thursday.

In Chapter 11 of the filed document, the retailer company signed an agreement with major creditors for a restructuring deal. The deal is worth $675 Million of debtor-in-possession financing. The company will use the amount to keep operations going as it makes efforts to reorganize.

Neiman Marcus Group is one of the major retailers to undergo widespread store closures amid the virus outbreak.  

“Like most businesses today, we are facing unprecedented disruption caused by the COVID-19 pandemic, which has placed inexorable pressure on our business,” Geoffroy van Raemdonck, the Chief Executive Officer of Neiman Marcus Group, said in a statement.

The 113-year-old retailer company started to cut its workforce by roughly 14,000 employees and temporarily closed 43 Neiman Marcus stores. TThe retail shut down included two Bergdorf Goodman locations in New York and two dozen Last Call stores. Neiman Marcus stores will remain closed until May 30.

According to court records, Neiman Marcus Group owes money not only to lenders but also to vendors such as Chanel, Gucci, and Yves Saint Laurent.