Investors look to buy New York’s institution Barneys out of bankruptcy
LUXURY retailer Barneys New York is in advanced talks with a group of retail industry investors looking to buy the company out of bankruptcy for about $220m (€200m), according to people with knowledge of the situation.
The effort is being led by Sam Ben-Avraham, known for his roles in starting New York retail store Atrium and streetwear brand Kith, the sources said. They asked not to be identified discussing a private matter.
The bid is one of several that have emerged as the retailer seeks to find a suitor for its assets to avoid liquidation.
Authentic Brands Group has also been in discussions about acquiring the Barneys name, Bloomberg previously reported. The joint bid led by Ben-Avraham is the furthest along and it contemplates an asset-based loan and cash to keep Barneys operating, the people said.
The talks are continuing, and there’s no certainty that a deal will be reached, the people added. Any offer would need approval from the bankruptcy court.
“We are in advanced negotiations with a potential purchaser and intend to reach an agreement by next Friday,” Barneys said in an emailed statement.
Ben-Avraham couldn’t be reached for comment and Authentic Brands had no immediate comment. The Wall Street Journal previously reported the potential deal.
Barneys filed for Chapter 11 in August with plans to close down most of its stores after getting squeezed by rising rents and fewer visitors. Its management has been seeking to sell a slimmeddown business and negotiate with its landlords through the court process.
The deal to rescue Barneys is expected to wipe out current equity owners including hedge fund veteran Richard Perry, who took control in 2012 in a debt-for-equity swap.
At a bankruptcy hearing last week, judge Cecelia Morris extended the deadline for a definitive agreement until October 11, which could be pushed out further depending on how talks advance. An auction for the assets is set for the end of the month.