Authentic Brands Offers $271M To Purchase Barneys Out Of Bankruptcy

A licensing company that owns Aeropostale and Juicy Couture has put in a $271 million bid to purchase luxury brand Barneys out of bankruptcy, with a plan to place the stores inside Saks Fifth Avenue stores.

CNBC is reporting that Authentic Brands Group has put in the bid with B. Riley Financial. Barneys recently filed for bankruptcy after its rent was doubled, while simultaneously dealing with less volume in sales.

The bid is basically a guarantee that the group will buy Barneys unless it gets outbid by another buyer.

Saks is another luxury retailer, with 39 locations in 22 states.

Barneys said the move was a “positive step forward” and indicates that Authentic Brands Group values the company.

“We are encouraged by the stalking horse bid by Authentic Brands Group in partnership with Saks Fifth Avenue,” a Barneys spokesperson said. “Additionally, we appreciate the ongoing interest by Sam Ben-Avraham and are actively pursuing additional options with those who have expressed their intent to submit bids during the upcoming auction process.”

Ben-Avraham co-founded the popular street fashion brand Kith, and he is actively partnering with other investors to make a bid of his own.

Barneys has shrunk lately, shedding five of its 10 stores. Analysts say the brand is strong but that the future of the retail locations is in question.

The most popular Barneys stores were in New York, then in Beverly Hills. It also did a lot of business online. When its rent was recently doubled by real estate investment company Ashkenazy Acquisition, the company said it was pushed it over the limit.

There is the possibility that Authentic Brands may try to negotiate the rent of the locations and keep Barneys there, especially since Barneys has a lot of infrastructure in the buildings that could potentially make it harder to find another company to lease the space.