Hong Kong Firm Interested in Barneys
Dickson Concepts Ltd., a Hong Kong-based retail giant, has expressed interest in acquiringBarneys Inc., the storied New York-based clothier that filed for bankruptcy protection in January.
Such a deal would give Dickson, which operates upscale department stores in Britain and Asia, its first foothold in the United States, including possible control of high-profile locations such as the Barney’s Beverly Hills store.
Dickson Concepts, headed by entrepreneur Dickson Poon, has been on a buying spree. Its recent acquisitions include Harvey Nichols in London and Hong Kong Seibu Enterprise Co., operator of several trendy department stores.
Barneys confirmed Thursday that it had been contacted by Dickson Concepts, but it downplayed the move.
“It’s too early to characterize these talks as negotiations,” said Sandra Sternberg, a spokeswoman for Barneys.
Sources said other retailers also have indicated an interest in Barneys, including Limited Stores Inc. and Holt Renfrew of Canada. However, Sternberg declined to confirm those reports, calling them speculation. Blackstone Group, Barneys’ financial advisor, has been asked to evaluate any buyout or investment offers.
Such offers must be explored under the terms of Barneys’ Chapter 11 bankruptcy filing. Bankruptcy debtors are required to examine all options in an effort to get the highest payout for creditors. Under the reorganization plan the company submitted, creditors would receive less than 100% of what they are owed. Sternberg said the plan is preliminary and subject to revision.
“The company has been trying to negotiate a resolution that reflects the best interests of all parties,” she said.
Some industry analysts believe Barneys, a privately held company controlled by brothers Gene and Rob Pressman, will be forced to sell all or part of the company to settle debts.
Questions about the company’s financial condition and management savvy surfaced before the bankruptcy filing when some of its suppliers complained about late payments.
“The likelihood of the Pressmans being forced out is extremely strong,” said Kurt Barnard, a New Jersey-based retailing economist. “There has been management incompetence. . . . The company expanded too far too fast.”
Barneys blames its problems, including the bankruptcy filing, on a dispute with Isetan Co., a Japanese firm that helped finance its expansion.
Barneys opened 12 of its 14 stores, including its Beverly Hills and Costa Mesa locations, after forming a relationship with Isetan. When Barneys filed for bankruptcy protection, it contended that Isetan had unfairly withdrawn financial commitments. Isetan disputes that and says Barneys owes it rent payments on some store properties, including the Beverly Hills store.
In the latest development in the dispute, Barneys on Wednesday obtained court approval to add Kenneth Klee, a bankruptcy specialist with the Los Angeles law firm of Stutman, Treister & Glatt, to its legal team.
Barneys operates its stores and seven outlet centers in 11 states.
