S&P Global Ratings has downgraded Saks Global Enterprises LLC to ‘SD’ (selective default) after the luxury retail group failed to make a roughly US$100 million interest payment due on December 30, 2025. The downgrade, issued on January 7, 2026, reflects a default on a specific class of obligations while the company continues to meet other debt commitments, according to S&P’s rating definitions.
The missed payment has sharply escalated Saks Global’s financial strain, intensifying concerns over liquidity and debt sustainability. The company has been under pressure since taking on approximately US$2.2 billion in debt to finance its acquisition of Neiman Marcus, a deal that significantly increased leverage at a time when the global luxury retail sector has been grappling with softer demand, rising costs and shifting consumer behavior.
Prior to the downgrade, Saks Global was rated ‘CCC’, already indicating substantial credit risk and vulnerability to adverse business or financial conditions. The move to ‘SD’ signals that stress has now translated into an actual payment default, a critical threshold for creditors and investors monitoring the company’s ability to service its obligations.
In August 2025, Saks Global secured $600 million in new funding in an effort to stabilize its balance sheet and support ongoing operations. However, S&P noted that this injection proved insufficient to offset mounting debt servicing requirements and near-term liquidity needs, culminating in the missed interest payment at the end of December.
Reports following the downgrade indicate that Saks Global is exploring strategic options, including a potential Chapter 11 bankruptcy filing, as it seeks to restructure its debt and preserve operations. While no formal filing has been announced, the selective default rating increases pressure on management to reach agreements with creditors or pursue court-supervised restructuring.
S&P Global Ratings defines a selective default as a situation where an issuer has failed to pay on one or more specific obligations but has not entered a general payment default across all debt. The agency said it will continue to monitor developments closely, particularly any restructuring negotiations, payment cures or bankruptcy proceedings that could affect the company’s overall credit profile.
