Barneys New York Sold In $271M Deal

NEW YORK — Barneys New York is set to be sold to a brand management firm in a $271 million deal that may shutter most of the retailer's stores.

A federal bankruptcy judge on Thursday approved the sale of troubled company to Authentic Brands Group in partnership with Saks Fifth Avenue, a Barneys spokesperson confirmed. Barneys filed for bankruptcy in August.

Another bidder could swoop in and make an offer before the sale officially closes tomorrow, Barneys said. But no better offers appeared to come through after Authentic Brands Group, also known as ABG, filed a stalking horse bid — a starting point for an auction — about two weeks ago.

"Over the past several months, we have worked diligently with the court, our lenders and creditors to maximize the value of Barneys in this sale process, and we continue to work with all relevant parties towards the best solution for Barneys’ employees, designers and vendors, and customers," Barneys said in a statement.

Authentic Brands Group, which made the purchase along with the investment bank B. Riley Financial, plans to license the Barneys name to Saks so the latter firm can open Barneys shops in its own department stores, The Wall Street Journal reported. ABG also reportedly plans to lay off many of Barneys's employees and close all but one of its retail stores, including its Madison Avenue flagship.

"While there’s a possibility that some of the stores may stay open, it’s likely that five locations and its distribution center will close and thousands of jobs will be lost; that is why we have continued discussions with other parties," Joshua Sussberg, a lawyer for Barneys, said in court Thursday, according to the Journal.

Barneys filed a notice with the state Department of Labor two weeks ago that it planned to lay off nearly 800 workers. A lawyer for the employees' labor union said then that fewer layoffs could materialize because the company was still searching for a buyer.

The sale approved Thursday could mark the beginning of the end for Barneys, a high fashion institution that has operated in New York City for nearly a century. The company also reportedly declared bankruptcy in 1996.