US-based GoldenTree Asset Management will invest $200m in a $1bn debtor-in-possession (DIP) financing for Saks Global Enterprises during its Chapter 11 restructuring.
Founded by billionaire Steve Tananbaum, the credit-focused investor will participate as a provider of new capital in the DIP loan, which carries super-priority status in the bankruptcy repayment order, citing sources, Bloomberg reported.
According to the report, the final financing terms are expected to be finalised this week.
GoldenTree Asset Management is joining a group of existing lenders, including Pentwater Capital Management and Bracebridge Capital, which are converting their current claims into the higher-ranking debt.
Saks Global sought Chapter 11 protection earlier this month, pointing to a substantial debt burden that had pressured liquidity and affected inventory availability.
Court filings show the company secured $1.75bn in financing as part of the bankruptcy process, including $1.5bn provided by senior secured bondholders.
The $1bn DIP facility is intended to support day-to-day operations and fund restructuring measures while the process is underway.
The retailer has already drawn $500m from the financing since entering Chapter 11.
It said the funds will help preserve business continuity and support transformation initiatives across its portfolio.
The report added that Saks Global also indicated it expects access to a further $500m in funding once it exits Chapter 11, which it anticipates later this year.
The financing arrangement has faced opposition from Amazon, which has filed objections seeking to prevent Saks from accessing the new funding.
Amazon argued that the borrowing would create billions of dollars in additional obligations and include provisions that would be unfavourable to it and other unsecured creditors.
Saks Global has said its Saks Fifth Avenue, Neiman Marcus, Bergdorf Goodman and Saks OFF 5TH stores will continue operating throughout the Chapter 11 proceedings, with all customer programmes remaining in place.
