As Barneys New York wades through bankruptcy, Saks Fifth Avenue and Authentic Brands have partnered to bid almost $270 million to buy the luxury specialty retailer, a source told The Wall Street Journal on Monday (Oct. 14).
Under the proposal, Barneys departments would open in some Saks stores, and Saks would also take possession of the Barneys website.
Barneys is also entertaining another offer by an investor group headed by Sam Ben-Avraham, who is best known for his roles in starting New York retail store Atrium and streetwear brand Kith. That bid is about $220 million, the article said.
The bankruptcy auction will take place no later than Oct. 29. Barneys has until Tuesday (Oct. 15) to accept more offers.
Saks is owned by Hudson Bay Company, while BlackRock holds the largest stake in Authentic Brands.
Barneys is far from alone in this “retail apocalypse,” but the renowned brand has bigger reputational issues than most stores, noted New York Times fashion critic Vanessa Friedman, according to Business Insider.
“[Barneys] was also unabashedly elitist, proudly exclusionary – you got it or you didn’t, and if you didn’t, that was your problem, not theirs – and imbued with an arrogance that, at a certain point, began to chafe,” Friedman wrote after the September bankruptcy announcement.
Barneys has already closed 15 of its 22 stores. The department store had filed for bankruptcy protection in the 1990s and survived.
The company has a nearly century-long history and has enjoyed a position of prestige as a provider of the finest luxury apparel. However, the company has not been immune to the same market conditions that sent Sears and Kmart into bankruptcy. It’s also dealing with a massive rent hike at its headquarters, which sent it frantically searching for a buyer. Rent at its Madison Avenue flagship increased to roughly $30 million in January, up from approximately $16 million.