In a similar fate to once-popular fashion retailers like Payless, Topshop and most recently Forever 21, iconic luxury store Barneys New York will soon be closing down after filing for bankruptcy and officially being acquired by Authentic Brands Group.
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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. My team and I still feel very strongly about Barneys: what it stands for and what it could mean in the future. We believe it has its place in New York’s landscape and beyond. During the process we were fortunate to meet a lot of amazing people who joined our team and gave everything they had to save this New York institution. 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. I know this chapter is about be be over and not the way I wished or imagined. I hope something greater will come from It. I want to thank my team who gave the fight of their lives and haven’t slept for the past two months. To all the people who believed in the dream and kept us going beyond the imagination. To all Barney’s family members who we met personally and the ones we met virtually and made us feel part of the family in that very short period. I wish I could do more. The stores might be gone but the spirit will live forever. Cheers to the life of Barneys. – Sam
Following a few attempts to keep the brand alive, including an unsuccessful “Save Barneys” bid by KITH co-founder Sam Ben-Avraham (seen above), Barneys was sold for a whopping $271.4 million USD to ABG. The brand management company, which also has Aeropostale, Nautica and Juicy Couture amongst other labels under its belt, originally planned to have all Barneys locations closed and its assets liquidated. However, the New York Post now reports that the retailer’s landlord, Ashkenazy Acquisition Corporation, announced today that a plan was worked out to keep the iconic NYC flagship store on Madison Avenue opened for at least another year.
Here’s the latest on the situation, via the New York Post:
The plan will be to “keep the Madison Avenue store open in a smaller footprint for the next 12 months while we continue to explore longer term solutions,” Ashkenazy said in the statement. “Fred’s will remain open as well,” it said, referring to Barneys’ restaurant on the 9th floor, known as a hot spot for celebrities and titans of industry.
The announcement came just hours after Barneys Chief Executive Daniella Vitale stepped down after the luxury chain was sold to licensing firm Authentic Brands Group, which had planned to liquidate stores, sources told The Post.
Under ABG’s plan, all Barneys stores were to be liquidated with the possible exception of the Boston store. ABG had wanted to keep its Madison Ave. and Beverly Hills stores open, but only if it could renegotiate leases on those stores.
Meanwhile, Barneys boutiques will be opened inside Saks Fifth Avenue stores.
As stated above, ABG is planning on licensing the Barneys name and intellectual property in general to one of its biggest competitors, Saks Fifth Avenue, which is owned by Hudson’s Bay Co. While this may seem like the loss of a legend for many fashion heads across the world, ABG is actually making moves that might breath new life into Barneys.
Take a look at the official statement that Authentic Brands Group has made about the acquisition, as reported by The Business Of Fashion:
“ABG will leverage its international scale, marketing expertise, and network of best-in-class partners to grow Barneys New York’s global presence across retail, including pop-ups, shop-in-shops, e-commerce, and a new freestanding store in a key US market. Its initial focus will be on high-fashion collaborations, branded namesake products, and expanding international retail in both brick and mortar and [e-commerce.] There is also a strategy in development for Freds to export this beloved eatery to luxury destinations around the world.”
— Authentic Brands Group, on the future of Barneys
However this turns out, we just know one thing is certain: that Barneys liquidation sale is about to be wild!
We’ll keep you guys updated on all the happenings in relation to the fall of Barneys New York. In the meantime, read an insightful article by Business Insider that breaks down how this all happened due to the company’s billionaire (now disgraced) chairman Richard Perry.