As the bankrupt retailer aims to avoid liquidation, a group of fashion executives is getting an approximately $220 million bid ready to take control of Barneys New York Inc. Sam Ben-Avraham, the founder of the New York retail store Atrium, is putting together a group of brand investors and retail veterans to aid in funding the bid, The Wall Street Journal reported.
A Barneys spokesperson said in a statement, “We are in advanced negotiations with a potential purchaser and intend to reach an agreement by next Friday.”
Ben-Avraham’s bid is expected to come with cash as well as an asset-backed loan for operations, per an unnamed source in the report. It is not known how much money other group members are putting into the effort or whether the loan has been secured.
If the deal is finalized, it is expected to eliminate existing equity owners that include Yucaipa Cos. and Perry Capital, per unnamed sources. The deal would reportedly also include an agreement with the landlord of the Beverly Hills and Madison Avenue stores. However, the bankruptcy court would still have to approve the bid.
On Thursday (Oct. 3), Judge Cecelia Morris extended the deadline for bids until Oct. 11. A lawyer for Barneys said the merchant was in negotiations with one buyer, but did not identify the party. Barneys New York put itself up for sale and filed for bankruptcy protection in August.
The retailer has a nearly century-long history, and has enjoyed a prestigious reputation for offering the finest luxury apparel. However, Barneys has not been immune to the same market conditions that sent Kmart and Sears into bankruptcy. It was also reportedly contending with a massive rent hike at its headquarters, which sent it frantically searching for a buyer.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Learn More