Saks Global Taps New CEO as Bankruptcy Whispers Swirl

The Boardroom Pivot

Manhattan’s flagship Saks Fifth Avenue was eerily quiet at dawn Wednesday when parent company Saks Global confirmed what insiders had whispered for weeks: a new chief executive would take the reins while the retailer races to outrun a looming Chapter 11 filing.

The Appointment

Effective immediately, former Target merchandising chief Carla Ramirez assumes the CEO post, replacing interim leader Richard Lang who steered the ship after Marc Metrick’s abrupt exit last quarter. Ramirez, 49, inherits a balance sheet weighed down by $2.8 billion in long-term debt and a missed $67 million interest payment due May 1.

“We are confident Carla’s record of turning around under-performing banners will unlock Saks’ next chapter,” said board chair Sheila Hopkins in a terse statement that offered no mention of bankruptcy.

Debt Clock Ticking

Sources familiar with creditor talks say advisors from Kirkland & Ellis have been hired to explore “strategic alternatives,” Wall-Street-speak for potential restructuring. Bond prices sank to 38¢ on the dollar Tuesday, a level that typically signals default within months.

• Q1 sales dropped 11% year-over-year to $1.9 billion
• Cash on hand fell below $200 million, barely covering two payroll cycles
• Landlords have received requests for rent deferrals on five flagship properties

A Merchant’s Gambit

Ramirez, who grew up folding sweaters at a St. Louis Saks outlet, is credited with reviving Target’s home category, pushing private-label share above 30%. Analysts say she must move fast:

“Apparel inventory is aging; every week of delay costs liquidity,” noted Simeon Siegel of BMO Capital Markets.

Employees at the Manhattan flagship were told to expect “streamlined assortments” and earlier clearance events. Union reps fear layoffs could hit cosmetics and men’s floors first.

What Happens Next

Saks Global has a 30-day grace period before the missed coupon pushes it into technical default. Negotiations with lenders center on:

1. Debt-for-equity swaps that could wipe out existing shareholders
2. Sale-leasebacks of the Fifth Avenue building, valued near $900 million
3. Potential takeover interest from Hudson’s Bay—once its Canadian cousin

Shoppers, for now, will see deeper red tags. Whether Ramirez can sell style while selling solvency may decide if the storied retailer survives the summer.