BARNEYS ASKS FUNDING OK TO SPEED UP INVESTOR BIDS
NEW YORK — Barneys Inc., with the support of the creditors’ committee, has requested bankruptcy court to approve up to $10 million in breakup fees and expenses to encourage potential investors to make their highest and best bids for Barneys.
The request is for up to $1.5 million in expenses and up to $8.5 million in breakup fees that would be awarded to a suitor, accepted by Barneys, who is later beaten out by a higher bidder.
The payouts are structured to motivate potential investors to come forward now and submit their highest and best proposal up front, Barneys said. The purpose of the request is to speed up the investment process.
Barneys noted that the investment process is at a “stage where the most attractive investment proposal may be received” if the request is granted. In addition, certain potential bidders have expressed a “willingness to submit more attractive investment proposals” if the payouts are put in place, Barneys said.
On Feb. 28, Dickson Concepts Ltd. offered a $240 million cash bid to purchase Barneys’ assets, which was rejected by the creditors committee. Barneys, however, has not rejected the bid and continues to review the offer.
There are also strong reports that Saks Holdings, parent of Saks Fifth Avenue, and Isetan Co. Ltd., which claims to be landlord of Barneys’ three flagship stores, are preparing a joint bid for Barneys.