A potential buyer is preparing a bid to take control of bankrupt luxury department store Barneys New York and help it stave off liquidation, the Wall Street Journal reported Thursday.
A group of fashion executives, led by Sam Ben-Avraham, is preparing a bid of about $220 million, the Journal wrote, citing people familiar with the situation. At a bankruptcy hearing Thursday, Barneys' lawyer said it was in negotiations with a buyer, and a judge extended the deadline for bids until Oct. 11 at a bankruptcy hearing, the Wall Street Journal reported. The bid would be subject to approval by the court.
"We are in advanced negotiations with a potential purchaser and intend to reach an agreement by next Friday," a Barneys spokeswoman said.
Ben-Avraham operates Liberty Fairs, a men's trade fashion show, and founded New York menswear store Atrium and streetwear brand Kith. He is bringing together other retail veterans and brand investors to help fund the bid, according to the Journal.
Barneys filed for bankruptcy in August, with a plan to significantly reduce its footprint. It planned to focus on running only five of its more than 10 namesake stores. It expected to close stores in Chicago, Las Vegas and Seattle, five smaller concept stores, and seven Barneys Warehouse stores.
The bid is expected to include an asset-backed loan and cash, but it is unclear if the group has secured a loan or how much others in the group are contributing, the Journal reported.
The deal would wipe out current owners who have equity in Barneys such as Perry Capital and Yucaipa Cos., and is expected to include an agreement with the landlord of its Madison Avenue and Beverly Hills stores, people familiar told the Journal.