FILE PHOTO: People walk in a Barneys New York store in New York on October 24, 2013. REUTERS / Eric Thayer
July 13, 2019
By Jessica DiNapoli and Mike Spector
NEW YORK (Reuters) – Barney New York Inc., an American operator of luxury department stores, is looking at various options, including a bankruptcy filing, as it faces high rents and changing consumer tastes. Saturday, experts said.
The nearly 100-year-old retailer, known for its collection of high-end stylists, is working with Kirkland & Ellis LLP law firm to prepare for a possible bankruptcy filing in the coming weeks, said one source. .
Barneys has not yet made a final decision on the opportunity to seek bankruptcy protection and is considering other possible solutions to deal with the high rents that are penalizing its business, the sources warned. . The bankruptcy filing would be an option to deal with expensive leases, the sources said.
The retailer's flagship department store on Madison Avenue in Manhattan has weighed on its finances, said one of the sources. The requested sources are not identified because the deliberations are confidential.
"At Barneys New York, our customers remain our top priority and we are committed to providing them with the excellent services, products and experiences they expect," the company said in a statement.
"We continue to work closely with all of our business partners to achieve the goals we have set for ourselves and maximize value. To this end, our Board of Directors and Management are actively evaluating opportunities to strengthen our balance sheet and ensure the long-term, sustainable growth and success of our business, "added the company.
In the event of bankruptcy, Barneys would be one of the most prominent casualties of the retail slowdown and would point out that even luxury department stores are not immune to fierce competition with e-commerce businesses such as than Amazon.com Inc.
Sears Holdings Inc., Toys "R" Us Inc. and Gymboree Group Inc. have also filed for bankruptcy in the past year.
In addition to its high-end department stores, Barneys operates Barneys Warehouse outlets and Freds restaurants. In all, Barneys has 28 branches, according to its website. Beverly Hills, California; Chicago; Seattle; Boston; San Francisco; and Las Vegas.
Barneys became known in the 1930s by placing women dressed in caskets in front of the breweries of New York City, where they were distributing matchbooks advertising the store, according to the retailer's website.
The store, now known for exclusive clothing made by designers such as Burberry Group Plc
(Report by Jessica DiNapoli and Mike Spector in New York, edited by Jonathan Oatis)