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08/09/2021

Saks Off 5th enhances liquidity with new loans

Marianne Wilson
Editor-in-Chief
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saks off 5th

Saks Off 5th is ready for its next chapter.

The online retailer has closed on a syndicated $125 million asset-based five-year revolving credit facility jointly arranged by Citibank and Citizens. It also closed a $20 million term loan arranged by Callodine Commercial Finance. 

In June, Saks Off 5th parent company Hudson’s Bay Co. partnered with venture capital firm investor Insight Partners to establish Saks Off 5th’s e-commerce business as a standalone entity. Insight has made a $200 million equity investment in Saks Off 5th’s online business, valuing it at approximately $1 billion. 

The move came after HBC and Insight teamed up  to establish Saks’ full-price e-commerce business as a standalone entity known as Saks. HBC retained full ownership of the retailer’s 40-store fleet, now operating separately as a company called SFA.

[Read More: Big Split: Saks Fifth Avenue stores, online site becoming separate companies]

"Saks Off 5.com continues to experience outstanding growth, and we see great opportunity ahead as we work to enhance our digital capabilities and customer experience,” said  Luke Coffey, CFO, Saks Off 5th. “These transactions further solidify our strong liquidity position and support our investment plan, providing us with additional financial flexibility."

The online retailer said it plans to use the money for general corporate purposes, working capital and capital expenditures. The company also said its strong balance sheet will be bolstered by the term loan proceeds, which follows a recent capital raise valuing the Saks Off 5th e-commerce business at approximately $1 billion.