Saks Incorporated Announces Saks Fifth Avenue's Planned Expansion into China; Saks Fifth Avenue to Open on the Historic Bund in Shanghai in Venture with Roosevelt China Investments.

NEW YORK -- Building upon its successful international ventures in Saudi Arabia and the United Arab Emirates, retailer Saks Incorporated (NYSE: SKS) (the "Company") today announced the formation of a strategic relationship to develop potential Saks Fifth Avenue stores in the People's Republic of China ("PRC") and Macau.

The Company has entered into a licensing and consulting agreement with Roosevelt China Investments Corp. ("RCIC") to locate and develop appropriate sites for potential Saks Fifth Avenue stores within PRC and Macau. RCIC will own and operate the stores under the license agreement with Saks Fifth Avenue.

The first Saks Fifth Avenue store tentatively is expected to open in 2008 in a heritage building in the historic Bund district of downtown Shanghai, PRC. Positioned along the beautiful Huangpu River, the Bund district is teeming with heritage buildings, and the entire area is currently undergoing extensive restoration and redevelopment. Shanghai, with a population of nearly 18 million people, is China's largest city.

Stephen I. Sadove, Chief Executive Officer of Saks Incorporated, commented, "Saks Fifth Avenue is one of the most recognized luxury retail brands in the world, and the only American department store retailer with a presence outside of the United States. In an effort to capitalize on the power of the Saks Fifth Avenue brand and to extend further its reach on a global basis, the Company opened its first international licensed store in Riyadh, Saudi Arabia in 2001 followed by its second international location in Dubai in 2004.

"China, with its explosive growth underway, is destined to become the commercial and tourist hub of Asia and is the logical location for our third international licensed Saks Fifth Avenue store. We look forward to working with RCIC to bring a distinctive world-class emporium of luxury brands and experiences to Shanghai and to meeting the fashion lifestyle needs of this very discerning, sophisticated, and important marketplace. Based on the success of the Saks Fifth Avenue store in Shanghai, we will consider future expansion into other cities in the region."

Sadove continued, "While our primary focus remains on our domestic stores, the opening of carefully chosen licensed locations abroad can extend the reach of our brand and generate an incremental income stream for Saks."

The Saks Fifth Avenue store is expected to be approximately 300,000 square feet and cover four floors. The location will be congruent with the Saks Fifth Avenue stores in the United States in both product and service, while being sensitive to local preferences and customs. The Shanghai store will include distinctive offerings from established and emerging Asian, European, and American designers and will present an enviable collection of fine designer apparel, shoes, jewelry, accessories, handbags, fragrances and cosmetics, intimate apparel, bridal, and select gift items under one roof. Saks Fifth Avenue will offer an extraordinary program of personalized customer service and expects to offer numerous in-store amenities such as luxury fitting rooms, specialty cafes, and a spa. The unique store will also offer an abundant calendar of special events such as fashion shows and personal appearances by designers.

Sadove concluded, "We are delighted to work with Roosevelt China Investments on these potential licensed store locations in China. The Roosevelt-affiliated organizations are very highly regarded, and we could not ask for a better business partner to assure our future success in China."

Tweed Roosevelt, Chairman of Roosevelt China Investments Corp., said, "We are delighted to be working with Saks Incorporated on this important project which is very exciting and beneficial for all involved. For Saks it opens the market for the rapidly expanding high-end customer base in East Asia currently untapped by premier U. S. retailers. For China, it is consistent with its announced objective to increase consumer spending. For Shanghai, it encourages tourist traffic from all over China and the rest of the Pacific Rim countries, as well as providing a flagship attraction during the 2008 Beijing Olympics. For the United States, it creates another business in China, which will generate the return of dollars to the United States, and for Roosevelt China Investments Corp. it helps fulfill its commitment to continue encouraging mutually beneficial relationships between China and the United States."

Tin Tse, President of Roosevelt China Investments Corp., said, "The extraordinary growth of the economy in China created many new customers for high end merchandising. The time is ripe for a first class American retailer to establish a presence in China to meet this rapidly growing demand. Saks is the ideal store to meet this need, and we are honored to partner with this premier American retailer."

Jiang Yaxin, District Governor of People's Government of Huangpu District said, "It is very farsighted for Roosevelt China Investments Corp. to make an investment in the Bund Origin commercial project. With the sustained and rapid economic development, the demand potential for high-end commodities is further expanding in China. In particular, Shanghai, as an emerging international city, is attracting more and more famous brands from all over the world. I sincerely hope that Roosevelt Bund Origin commercial project will become an epoch-making one in the development of commercial industry in Shanghai and a successful model of Sino-US cooperation on the basis of mutual benefit."

About the Companies

Saks Incorporated currently operates Saks Fifth Avenue Enterprises (SFAE), which consists of 55 Saks Fifth Avenue stores, 50 Saks Off 5th stores, and saks.com. The Company also operates 38 Parisian stores and 57 Club Libby Lu specialty stores. In January 2006, the Company announced it is exploring strategic alternatives for Parisian.

Founded in 1924 with the opening of its Fifth Avenue, New York flagship store - which continues today to be the Company's landmark store - Saks Fifth Avenue has grown to 55 stores throughout the United States, complemented by two licensed stores in the Middle East. Saks Fifth Avenue is one of the most recognized luxury retail brands in the world and has key relationships with the leading fashion houses including Giorgio Armani, Chanel, Dolce and Gabbana, Salvatore Ferragamo, Gucci, Donna Karan, John Varvatos, Calvin Klein, Ralph Lauren, Judith Leiber, Prada, Escada, Carolina Herrera, Oscar de la Renta, St. John, Yves St. Laurent, TOD'S, Ermenegildo Zegna and Max Mara.

Roosevelt China Investments Corp. (RCIC) is a privately owned international investment company dedicated to conducting business in China. RCIC was established with the support of the Roosevelt Trust, one of the investment vehicles of the Roosevelt family. Tweed Roosevelt, great-grandson of President Theodore Roosevelt and cousin of President Franklin Roosevelt, is Chairman of RCIC. In addition, Tweed Roosevelt is also the Principal Trustee of The Roosevelt Trust and also is a Managing Director of The Roosevelt Investment Group, Inc., a registered investment advisor, which currently manages approximately $1 billion in client assets. Tin Tse, President of RCIC, has had extensive experience in China and is principally responsible for this project.

Forward-looking Information

The information contained in this press release that addresses future results or expectations is considered "forward-looking" information within the definition of the Federal securities laws. Forward-looking information in this document can be identified through the use of words such as "may," "will," "intend," "plan," "project," "expect," "anticipate," "should," "would," "believe," "estimate," "contemplate," "possible," and "point." The forward-looking information is premised on many factors, some of which are outlined below. Actual consolidated results might differ materially from projected forward-looking information if there are any material changes in management's assumptions.

The forward-looking information and statements are or may be based on a series of projections and estimates and involve risks and uncertainties. These risks and uncertainties include such factors as: the level of consumer spending for apparel and other merchandise carried by the Company and its ability to respond quickly to consumer trends; adequate and stable sources of merchandise; the competitive pricing environment within the department and specialty store industries as well as other retail channels; the effectiveness of planned advertising, marketing, and promotional campaigns; favorable customer response to relationship marketing efforts of proprietary credit card loyalty programs; appropriate inventory management; effective expense control; successful operation of the Company's proprietary credit card strategic alliance with HSBC Bank Nevada, N.A.; geo-political risks; changes in interest rates; the outcome of the formal investigation by the Securities and Exchange Commission and the inquiry the Company understands has been commenced by the Office of the United States Attorney for the Southern District of New York into the matters that were the subject of the investigations conducted during 2004 and 2005 by the Audit Committee of the Company's Board of Directors and any related matters that may be under investigation or the subject of inquiry; the ultimate amount of reimbursement to vendors of improperly collected markdown allowances; the ultimate impact of improper timing of recording of inventory markdowns; the ultimate impact of incorrect timing of recording of vendor markdown allowances; the outcome of the shareholder litigation that has been filed relating to the matters that were the subject of the Audit Committee's initial investigation; the effects of the delay in the filing with the SEC of the Company's Form 10-K for the fiscal year ended January 29, 2005 and its Quarterly Reports on Form 10-Q for the fiscal quarters ended April 30, 2005 and July 30, 2005; the ability of The Bon-Ton Stores, Inc. to obtain financing to complete its purchase of the Company's NDSG business; and the success of the Company's exploration of strategic alternatives for its Parisian business. For additional information regarding these and other risk factors, please refer to Exhibit 99.1 to the Company's Form 10-K for the fiscal year ended January 29, 2005 filed with the SEC, which may be accessed via EDGAR through the Internet at www.sec.gov.

Management undertakes no obligation to correct or update any forward-looking statements, whether as a result of new information, future events, or otherwise. Persons are advised, however, to consult any further disclosures management makes on related subjects in its reports filed with the SEC and in its press releases.