(Bloomberg)—A planned auction for bankrupt retail icon Barneys New York Inc. next week was canceled after a consortium led by entrepreneur Sam Ben-Avraham failed to place a qualifying bid.
Authentic Brands Group LLC, currently the only qualified bidder for Barneys, said in a statement that it expects to complete its purchase of Barneys intellectual property on Oct. 31, subject to customary closing procedures.
But Barneys plans to continue to negotiate toward rival “going concern” bids despite the auction cancellation.
“We are continuing to work towards a value-maximizing going concern transaction for the company, including in relation to a potential transaction led by Sam Ben-Avraham and his group of financial, operational, and strategic partners, up to and including the Oct. 31 sale hearing,” a Barneys representative said in an emailed statement.
Barneys had managed to delay its deadline for offers and its auction as Ben-Avraham said he planned to submit a bid, one that would “maintain the integrity of the brand and its relationship with the customers, suppliers, and workers,” he said previously.
Failed Bid
Ben-Avraham’s group put forth a bid, but it failed to qualify in the bankruptcy case, according to people familiar with matter who weren’t authorized to speak publicly. He also led a public campaign around his bid using a #SaveBarneys slogan.
The Authentic Brands group offer of about $271 million includes a plan to open Barneys shops in Saks Fifth Avenue stores, Bloomberg previously reported. It also calls for closing seven Barneys stores.
“We look forward to proceeding with our plans for Barneys as we continue the closing process,” Authentic said. “Barneys is one of the most recognizable and iconic names in luxury lifestyle. Our goal is to preserve and build upon Barneys’ legacy and evolve it for the future.”
Authentic owns and licenses fashion, celebrity and media brands including Nine West and Sports Illustrated. Barneys selected the company as its so-called stalking horse bidder, which sets a floor for further offers in a bankruptcy sale process.
Ben-Avraham didn’t immediately respond to a request for comment.
The case is Barneys New York Inc., 19-36300-cgm, U.S. Bankruptcy Court for the Southern District of New York (Poughkeepsie).
--With assistance from Katherine Doherty.
To contact the reporters on this story: Lauren Coleman-Lochner in New York at [email protected]; Eliza Ronalds-Hannon in New York at [email protected];
Jeremy Hill in New York at [email protected].
To contact the editors responsible for this story: Rick Green at [email protected]
Nicole Bullock
© 2019 Bloomberg L.P.
