Key Points
- Amazon is objecting to Saks Global’s bankruptcy financing plan.
- Amazon invested $475 million in Saks in 2024, an investment it now considers “worthless.”
- The company claims Saks “burned through hundreds of millions of dollars” and failed to meet its obligations.
- Amazon is concerned that the new financing plan will push it further down the repayment priority list.
Amazon is trying to block a bankruptcy financing plan from the department store Saks Global, claiming the retailer “burned through hundreds of millions of dollars” and failed to live up to its end of a major deal. The move comes just hours after Saks filed for Chapter 11 bankruptcy protection.
The two companies have a complicated history. When Saks acquired Neiman Marcus for $2.7 billion in December 2024, Amazon invested $475 million in the combined company. The deal was supposed to be a win-win: Saks would get a much-needed cash infusion and access to Amazon’s tech and logistics expertise, while Amazon would get a “Saks at Amazon” storefront on its website, boosting its presence in the luxury market.
But according to Amazon, the partnership was a disaster. In a court filing, Amazon’s lawyers said their investment is now “presumptively worthless.” They claim that Saks “continuously failed to meet its budgets” and ran up “hundreds of millions of dollars in unpaid invoices.”
Now that Saks is bankrupt, Amazon is concerned it will be left holding the bag. The company is objecting to Saks’s new financing plan, arguing that it would saddle the company with even more debt and push Amazon further down the list of creditors to be repaid.
Amazon says it “hopes” to resolve the issue with Saks, but it’s also threatening to “seek more drastic remedies” if its concerns are not addressed.
A judge has already authorized Saks to access $1.75 billion in new financing to avoid immediate liquidation. But the fight with Amazon is just beginning, and it’s a stark reminder of the risks involved when tech giants try to bail out struggling old-school retailers.
