US department store chain, Neiman Marcus, has filed for Chapter 11 bankruptcy protection as a result of the ongoing coronavirus pandemic.
The chain will not liquidate, but expects to emerge from a restructuring later this year.
Chairman and chief executive Geoffroy van Raemdonck said prior to the Covid-19 outbreak the group “was making solid progress on our journey to long-term profitable and sustainable growth.”
He added: “However, like most businesses today, we are facing unprecedented disruption caused by the Covid-19 pandemic, which has placed inexorable pressure on our business.”
The retailer has secured $675m in financing from creditors as part of a financial restructuring agreement. It has also secured a further $750m it hopes will finance its exit from bankruptcy proceedings by “early fall.”
The creditors will become majority owners of the company.
Neiman Marcus expects to eliminate $4bn of debt.
The business has furloughed, or temporarily reduced the salaries of, a “large proportion of associates” until at least 31 May.
It has said it will continue to assess store closure decisions and will reopen stores as it is safe to do so.