Macy's taps Lazard for capitalization

Macy's has tapped investment bank Lazard to explore financing options after the company lost an enormous share of their revenue due to closing brick-and-mortar stores over coronavirus. Macy's, like many other physical retail stores, was already having a hard time with the consumer shift to online shopping, but with most of their sales still coming from physical retail the coronavirus shutdown was not helping.

In order to stay afloat, Macy's has furloughed employees for the time being to cut costs. Lazard, a company known for helping financially troubled companies rework their debts, could be the saving grace for Macy's. Macy's has also tapped debt restructuring law firm Kirkland & Ellis LLP to help alleviate the retailer's debt burden.

Macy's has taken other steps toward maintaining its financial position as best as possible including suspending its quarterly dividend, drawing down its credit line, deferring spending, and slashing executive pay. Neither Kirland nor Lazard immediately replied for comment on the matter.

Macy's has 3.6 billion dollars in long-term debt and 7 billion dollars in store lease obligations. Macy's had 685 million in cash at the end of its last fiscal year, and withdrew 1.5 billion from its credit line as it had to temporarily close stores. Once businesses begin to reopen after coronavirus, Macy's will still have to clean house. Coronavirus aside, the company was already expected to close 125 stores over the next three years and slash 2000 employees. All of Macy's 775 stores are currently closed due to coronavirus, and there's still no clear end date in sight for when they could reopen.

photo: via Macy's newsroom