Of its 22 locations, Barneys plans to close 15, including the Chicago, Las Vegas and Seattle flagships, five smaller stores and seven outlets known as Barneys Warehouses.
According to Daniella Vitale, Barneys chief executive officer and president, the company and its board are taking “decisive action” to get the company through a court-supervised sale process, review leases and keep a restructured Barneys business operating.
Barneys said Tuesday it will continue to operate five of its flagships: Madison Avenue, 17th Street in the Chelsea section of Manhattan; Beverly Hills; San Francisco, and Copley Place in Boston, as well as two warehouse locations in Woodbury Common in Central Valley, N.Y., and San Francisco Premium Outlets in Livermore, Calif. In addition, barneys.com and barneyswarehouse.com will continue operating, the company said.
As reported, Barneys filed for reorganization under Chapter 11 of the U.S. Bankruptcy Code early Tuesday morning.
“For more than 90 years, Barneys New York has been an iconic luxury specialty retailer, renowned for its edit, strong point of view, creativity and representation of the world’s best designers and brands,” Vitale said. “Like many in our industry, Barneys New York’s financial position has been dramatically impacted by the challenging retail environment and rent structures that are excessively high relative to market demand. In response to these obstacles, the Barneys New York board and management team have taken decisive action by entering into a court-supervised process, which will provide the company the necessary tools to conduct a sale process, review our current leases and optimize our operations. While doing that we are receiving new capital to help support the business. Pursuing a sale under the court’s supervision provides the quickest and most efficient means of maximizing value while ensuring we continue serving both new and loyal customers.”
Vitale went on to express her “deep appreciation and profound gratitude for the continued support of our employees, vendor community and customers — truly the lifeblood of Barneys New York.” She expressed hope that Barneys will continue well into the future, despite the uncertainties that come with being a bankrupt company.
“Our decades-long partnerships and relationships will continue for many years to come,” Vitale said. “We are unwavering in our commitment to executing our forward-thinking vision on what retail should look like today.”
Barneys filed motions seeking authorization to support its operations during the court-supervised process, including authority to continue payment of employee wages and benefits and honor customer payments and orders. Barneys said it expects to pay trade vendors, manufacturing partners and suppliers in full for goods and services provided on or after the filing date.
Kirkland & Ellis LLP is serving as Barneys’ legal adviser; Houlihan Lokey is serving as financial adviser, and M-III Partners LP is serving as the restructuring adviser.
Caught Up in the Barneys Bankruptcy
The luxury retailer now has a list of more than 5,000 creditors hoping to get paid through bankruptcy court. Here are the top 30.
|Creditor||City||Nature of claim||Unsecured claim|
|1||Jenel Management||New York||Lease||$5,984,632|
|2||The Row||New York||Trade payable||$3,737,748|
|3||Celine Inc.||New York||Trade payable||$2,747,305|
|4||Thor Equities||New York||Lease||$2,228,976|
|5||Yves Saint Laurent America Inc.||Secaucus, N.J.||Trade payable||$2,186,576|
|6||Balenciaga America Inc.||Secaucus, N.J.||Trade payable||$2,139,845|
|7||Givenchy Corp./LVMH||New York||Trade payable||$1,944,171|
|8||Gucci||New York||Trade payable||$1,797,504|
|9||Google Inc.||Mountain View, Calif.||Trade payable||$1,706,932|
|10||Prada||New York||Trade payable||$1,626,504|
|11||Rakuten Marketing, formerly LinkShare Corp.||New York||Trade payable||$1,584,130|
|12||GGR U.S.||New York||Trade payable||$1,461,149|
|13||Azzedine Alaïa||Paris||Trade payable||$1,396,258|
|14||Margiela USA Inc.||New York||Trade payable||$1,370,604|
|15||CL US Distribution Corp. (Christian Louboutin)||New York||Trade payable||$1,283,586|
|16||Moncler USA Inc.||New York||Trade payable||$1,205,973|
|17||Chloé||New York||Trade payable||$995,965|
|18||Shiseido Cosmetics||New York||Trade payable||$990,192|
|19||Stockton Street Properties Inc.||Dallas||Lease||$953,528|
|20||Isaia Corp.||New York||Trade payable||$942,977|
|22||Chanel||Piscataway, N.J.||Trade payable||$877,516|
|23||Loewe||New York||Trade payable||$877,323|
|24||Canada Goose U.S. Inc.||Boston||Trade payable||$870,103|
|25||Etoille||New York||Trade payable||$866,977|
|26||Tribeca Design Studio||New York||Trade payable||$854,691|
|27||Manolo Blahnik USA||New York||Trade payable||$831,984|
|28||Rag & Bone||New York||Trade payable||$823,234|
|29||Owenscorp Italia||Torino, Italy||Trade payable||$816,999|
|30||The Building at 575 Fifth Avenue||Philadelphia||Lease||$815,240|