BARNEYS SEES DEAL SIGNED BY MAY 28
Byline: Vicki M. Young
NEW YORK — Barneys Inc. expects to execute by May 28 an agreement to be purchased, the specialty retailer said in court papers filed Friday in Manhattan Bankruptcy Court.
Barneys, which filed Chapter 11 bankruptcy in January 1996, also said that it will need all of June to resolve potential objections to the agreement, and analyze any higher and better offers that might follow a May agreement.
Barneys’ exclusive right to file a plan of reorganization ends May 5, but included in the Friday filing was a request for a 120-day extension, until Sept. 2, to file a plan. A hearing on the request is scheduled for April 24. On the same day, the bankruptcy court will hear Barneys’ request to provide a $10 million “breakup” fee for a bidder that is approved by Barneys in May but is subsequently outbid by another party.
A bid that’s accepted by Barneys and its creditors would pull the chain out of bankruptcy by funding a reorganization. Barneys said that it will concentrate on preparing and filing a reorganization plan and disclosure statement in July and August.
The only bidder for Barneys so far is Dickson Concepts Ltd., which submitted a $240 million cash offer on Feb. 28. That bid, which was promptly rejected by the creditors’ committee, has not been rejected by Barneys. However in its filing on Friday, Barneys did indicate for the first time that “the Dickson proposal as submitted is inadequate.”
Last week, in an exclusive interview with WWD, Dickson Poon, chairman of Dickson Concepts, said he thought his offer is fair and that Barneys fits into his company’s global strategy. He gave no clue as to whether he was prepared to go higher with a second offer, though there has been speculation that his first offer was just a preliminary one, designed to get the bidding process rolling.
In its filing last week, Barneys did not identify any potential new bidders, or who the company expects to bid in May. It’s believed that the Pressman family, current owners of Barneys, are most interested in Dickson, and that with Dickson, Gene and Robert Pressman, Barneys co-chairmen, have the best chance of maintaining some role in the running of Barneys under new ownership.
Saks Holdings, parent of Saks Fifth Avenue, is expected to make a bid for Barneys. During the Seventh Avenue collections last week, Philip Miller, Saks chairman and chief executive officer, told WWD that Saks is “absolutely” interested in a deal.
Saks is reportedly negotiating with Isetan Co. Ltd. to team up on a bid. With Isetan as an ally, Saks would become a very formidable bidder, considering Isetan is in a heated dispute with Barneys about whether it’s the landlord for the three Barneys flagship stores, in Chicago, Beverly Hills and on Madison Avenue, or an equity partner. Valuation of Barneys can’t be done until that issue is resolved.
Neiman Marcus Group is also exploring the possibility of making a bid, but is said to be less interested than Saks or Dickson.
Other companies that have been rumored as potential bidders are LVMH Moet Hennessy Louis Vuitton, which has denied any interest, and Holt Renfrew, which said it prefers to focus on its business in Canada rather than expanding to the U.S.
John P. Brincko, Barneys’ president and chief operating officer, said in an affidavit that the anticipated mid-April trial to resolve the Isetan real estate dispute won’t be held until late June because both sides are still gathering evidence.