Saks OFF 5th Digital Receives Court Approval to Liquidate Inventory
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Saks OFF 5th Digital, the eCommerce arm of Saks Global, received approval from the U.S. Bankruptcy Court for the District of Delaware on January 24,2026,to hire a liquidator and begin selling its remaining inventory as part of its ongoing bankruptcy proceedings. This move aims to maximize value for creditors.
Bankruptcy Filing and Context
Saks OFF 5th filed for Chapter 11 bankruptcy on January 9, 2026, citing challenges in the competitive off-price retail landscape and the need to restructure its operations. Reuters reported the filing, noting the company’s struggles with declining sales and increasing debt.
The bankruptcy filing followed a period of financial difficulties for the retailer, exacerbated by shifts in consumer spending and increased competition from online retailers. Saks Global, the parent company, had previously attempted to separate Saks OFF 5th from its luxury namesake brand.
Liquidation Process and Court Approval
The liquidation process allows Saks OFF 5th Digital to sell its inventory in an orderly manner, perhaps recovering funds that would otherwise be lost through continued operation. The court’s approval, granted on January 24, 2026, authorizes the company to engage a liquidator to manage the sale. Bloomberg details the court’s decision.
According to court documents filed with the U.S. Bankruptcy Court for the District of Delaware (Case Number 26-bk-10012), the liquidation is expected to begin immediately and continue over the coming weeks. The liquidator will be responsible for marketing and selling the inventory through various channels, including online sales and potential physical store closures.
Several entities are involved in the Saks OFF 5th Digital bankruptcy proceedings:
- Saks Global: The parent company of saks OFF 5th Digital.
- U.S. Bankruptcy Court for the District of Delaware: The court overseeing the bankruptcy case.
- Hilco Merchant Resources: The liquidator approved by the court to manage the inventory sale. Hilco’s website provides information on their liquidation services.
- Creditors: Various financial institutions and vendors owed money by Saks OFF 5th Digital.
Impact and Future outlook
The liquidation of Saks OFF 5th Digital’s inventory represents a significant step in the company’s restructuring efforts. While the liquidation will result in the loss of remaining inventory, it is intended to provide funds to creditors and potentially pave the way for a future reorganization.
As of January 25, 2026, the future of Saks OFF 5th remains uncertain. The company is continuing to explore options for restructuring its business and potentially emerging from bankruptcy. The outcome will depend on the success of the liquidation process and the company’s ability to negotiate with creditors.
