Saks Global Enterprises is considering raising up to $350 million in debt as well as selling some its real estate assets to shore up its finances as stock-market volatility and China tariffs threaten to slow luxury spending.

The fresh debt would come through a so-called first-in, last-out loan under its existing $1.8 billion revolving credit facility, Chief Executive Officer Marc Metrick said.

“We’re in the early days of the process now but we’re not looking at this being a long process,” Metrick told Bloomberg News in an interview.

Metrick said Saks had between $360 million to $400 million in liquidity, which he considers an “ample amount.” The loan would help Saks shore up its balance sheet, leaving it better prepared to weather a potential pullback in spending from luxury shoppers hit by market volatility and likely price hikes on items imported from China.

The company also told lenders on a call on Monday that it is exploring the sale of some of its real estate assets, according to people familiar with the matter, who asked not to be identified discussing confidential information. A Saks spokesperson declined to comment on the matter.

Saks bonds plunged further on Monday even after the company told creditors earlier in the day that its vendor troubles have eased. It also said inventory is up after it instituted a plan in February to gradually pay suppliers past due balances over the course of more than a year.

The company’s management held the call with creditors after revealing last week that it was considering taking on more debt to boost its coffers.

The bonds, secured notes due in 2029, fell to about 53 cents on the dollar, according to Trace. They have lost almost half of their value since being issued in December.

Neiman Marcus

The company is also focused on integrating Neiman Marcus Group, which it acquired last year, and rolling out plans — still undisclosed — to tap partnerships with new stakeholders including Amazon, Authentic Brands and Salesforce to boost growth.

“We’re looking at a world that is turbulent with a lot of uncertainty,” Metrick said. “We have big plans.”

Metrick said Saks is ahead of schedule on cutting overlapping costs as it integrates Neiman Marcus. The company was targeting $100 million in synergies in its fiscal year that started on Feb. 2 and is now sees that figure reaching $150 million, Metrick said.

Luxury shoppers

The recent market turmoil has caused some volatility in the shopping patterns of Saks’ high-income shoppers, but they haven’t pulled back on spending.

“There have been fits and stops,” Metrick said. “But it’s not been that long for us to really read into how they are actually going to react and behave.” Around 2% of Saks’ shoppers account for around 40% of sales, he added.

Many of those shoppers buy high-end luxury products that are imported from Europe, and Saks is expecting price hikes on those products to be in line with recent years. Prices on luxury goods have jumped by around 10% to 15% annually and the CEO said that Saks expects the impact of tariffs on such products imported from Europe will fall within that range.

More notable price hikes are likely, though, on contemporary apparel, which costs less than high-end luxury items and represents around 20% of sales. Many of those items are sourced in China, Metrick said.