NEW YORK, Aug 7 — New York-based department store Barneys has officially filed for bankruptcy and put itself up for sale after weeks of speculation — sending the retail market into shock.
The American chain, known for its selection of luxury brands and high-end clientele, has entered into an agreement with Gordon Brothers and Hilco Global, providing it with US$75 million (RM314 million) of new capital to stay afloat during the proceedings.
As part of the restructuring, Barneys has announced that it will also be closing its physical store locations in Chicago, Las Vegas and Seattle, in addition to five smaller concept stores and seven Barneys Warehouse locations.
Commenting on the decision to file Chapter 11 bankruptcy protection, Barneys chief executive officer and president Daniella Vitale said that like many in the industry, the company’s financial position had been dramatically impacted by the challenging retail environment and rent structures that are excessively high relative to market demand.
In a statement, she added that: “In response to these obstacles, the Barneys New York Board and management team have taken decisive action by entering into a court-supervised process, which will provide the Company the necessary tools to conduct a sale process, review our current leases and optimise our operations.
“While doing that we are receiving new capital to help support the business. Pursuing a sale under the Court’s supervision provides the quickest and most efficient means of maximising value while ensuring we continue serving both new and loyal customers.”
The company confirmed that it will continue to serve customers in five flagship Barney’s locations: Madison Avenue, Downtown NYC, Beverly Hills, San Francisco and Copley Place in Boston, as well as two Barneys Warehouse locations, including Woodbury Common, NY and Livermore, California. In addition, Barneys.com and BarneysWarehouse.com will continue serving customers “without disruption.” — AFP-Relaxnews
