The sale of Barneys New York to Authentic Brands Group is complete. This morning Judge Cecelia G. Morris ruled in court that ABG and its partner B. Riley Financial, which provided the chain with a bankruptcy loan, would acquire Barneys’s assets and intellectual property for $271.4 million. Barneys’s new owners are expected to close the majority of its stores, let go thousands of employees, liquidate its remaining assets, and license the Barneys New York name and intellectual property to Saks Fifth Avenue.
The aftershock of the sale was immediate, with the fashion community taking to social media. On the @barneysny account, followers have flooded its most-recent post with crying emojis. On the popular @savebarneys account, run by once potential bidder Sam Ben-Avraham, there are comments of dismay as well as others accusing Ben-Avraham of playing up emotions with no real intention of acquiring Barneys New York.
In a post published after this morning’s ruling, the investor confirmed he had pulled out of bidding: “Dear Family, Last night after two months of working around the clock, my team and I had to make the hardest decision we could have imagined: to pull out of the race and not go to court this morning. This was one of the hardest decisions I have made in my life thus far. […] Unfortunately, we failed to convince enough people in the business community that it made economic sense to keep Barneys alive. Some unexpected road blocks were put in our way. We understood from the beginning that looking at spreadsheets and numbers, it did not make sense, but we saw a future beyond that. We knew that once we overcame that hurdle there would be light at the end of the tunnel. I apologize if I have failed anyone, and gave anyone false hope by not being able to close the deal.”
As for what’s next, rumors are already swirling within the industry about a liquidation sale that could put Barneys’s legendary Warehouse Sales to shame. The expectation is that all remaining merchandise, the highest-end of luxury goods, could be marked down intensely. That might be good news for shoppers looking for a deal, but it’s bad news for brands whose goods will be offered at steep discount and for other retailers who are relying on luxury spending this holiday season.
Source: Vogue.com
