More On: bankruptcy
MetaMask co-founders claim bitcoin isn't 'finance's future' yet, attack CeFi systems
Mega-music retailer Guitar Center filing for Chapter 11 bankruptcy
Wendy’s wants to buy nearly 400 of its restaurants out of bankruptcy
Regal Cinemas owner Cineworld eyes UK theater closures and rescue deal
Nearly 300 US businesses that got COVID-19 aid through PPP have reportedly closed
Neiman Marcus Chief Executive Geoffroy van Raemdonck is facing a mutiny by a group of lenders unhappy about his plans to revive the company through bankruptcy, The Post has learned. The lenders — who are looking to replace Raemdonck one week after he filed for Chapter 11 bankruptcy — claim he lacks the skills to …
Neiman Marcus Chief Executive Geoffroy van Raemdonck is facing a mutiny by a group of lenders unhappy about his plans to revive the company through bankruptcy, The Post has learned.
The lenders — who are looking to replace Raemdonck one week after he filed for Chapter 11 bankruptcy — claim he lacks the skills to navigate Dallas-based retailer through its coronavirus woes, according to a source with knowledge of the discussions.
The push, which comes one day after hedge fund Mudrick Capital Management called on Neiman to join forces with Saks Fifth Avenue, has even resulted in a list of replacement candidates, including Raemdonck’s predecessor and longtime Neiman CEO Karen Katz, the source said.
Other contenders on the interim-CEO list include ex-Neiman President Jim Gold, former Saks Fifth Avenue Chief Executive Stephen Sadove, and Chris Sim, Neiman’s current chief operating officer, the source said.
On Tuesday, hedge fund and Neiman lender Mudrick Capital urged Neiman’s independent directors to consider a sale to Saks’ parent Hudson’s Bay, according to a copy of Mudrick’s letter obtained by The Post.
Hudson’s Bay explored a Neiman takeover as recently as 2017, but Raemdonck told Reuters, which first reported on the letter, that a deal with Saks is not at the top of the company’s priority list.
The lenders are also unhappy with Raemdonck because of his perceived ties to a controversial 2018 deal to shield the company’s crown jewel — online shopping unit Mytheresa, valued at about $1 billion — from the bankruptcy, the source said.
The transaction, which limits what debtors can get in Neiman’s bankruptcy, has already been the focus of several shareholder lawsuits. Neiman has denied any wrongdoing.
Raemdonck, a Frenchman who hailed from Ralph Lauren, was handpicked by private equity firm Ares Management, which bought Neiman Marcus in 2013 in a leveraged buyout that saddled the company with $5 billion of debt. Ares “has been accused of stripping the Mytheresa business away from Neiman Marcus,” said distressed debt expert Adam Stein-Sapir.
Lenders are also concerned that the luxury retailer has said it will burn through $370 million by the end of July. One reason for the high cash burn rate is that Neiman Marcus has agreed to continue to pay rent during the pandemic, in contrast with peers who have chosen to skip rent amid state-ordered lockdowns.
A second source close to Neiman Marcus, who did not want to be identified, said there has also been “a fair amount of grumbling from current and recently departed executives“ about Raemdonck. “He didn’t seem to be on their radar screen for a big job.”
“He appears to be more of a merchant with a fashion bent and eye,” retail consultant Craig Johnson said, “as opposed to someone who will make the trains run on time.”
Neiman Marcus did not immediately respond to a request for comment.
