Saks Global is preparing to end its “Saks on Amazon” online retail partnership with Amazon, reported Reuters, citing sources.

The decision comes as the US luxury retailer undergoes restructuring under Chapter 11 bankruptcy protection.

The arrangement had already come under pressure after Saks sought court protection earlier this month, though the company had not publicly stated that it intended to terminate the contract.

Sources familiar with the matter told Reuters that the retailer now plans to wind down its dedicated Amazon storefront to concentrate on parts of the business it expects to deliver stronger growth.

The collaboration followed Amazon’s $475m investment in Saks in 2024.

Under the agreement, Saks was to sell merchandise through Amazon and pay the e-commerce group at least $900m over eight years.

However, remarks made by Amazon’s lawyer during a court hearing after the bankruptcy filing suggested relations between the two sides had worsened and that disputes could emerge.

At that session, the lawyer argued that Saks had wrongly pledged its flagship Fifth Avenue property in Manhattan as security for a $1.75bn loan intended to keep the business operating during the proceedings.

According to the argument, the building had already been used to back Saks’ payment commitments to Amazon under their deal.

The partnership was also facing resistance from some of Saks’ key luxury labels, according to two sources familiar with the brands.

Those brands were concerned that selling through a mass-market online platform could weaken their positioning, and were expected to use the bankruptcy talks to challenge the arrangement.

Last week, Saks Global set out plans to shut most of its off-price operations as part of the Chapter 11 process, shifting its focus towards luxury and full-price retailing across its portfolio.

The company said it intends to close the majority of its Saks OFF 5TH outlets along with all remaining Last Call stores after assessing the performance of those units.