NEW YORK: US luxury department store operator Barneys New York Inc is exploring options that include a bankruptcy filing, as it struggles with high rents and changing consumer tastes, people familiar with the matter said on Saturday.
The nearly 100-year-old retailer, known for its high-end designer collection, is working with law firm Kirkland & Ellis LLP to prepare for a potential bankruptcy filing that could come in the coming weeks, one of the sources said.
Barneys has not yet made a final decision on whether or not to seek bankruptcy protection, and is weighing other possible solutions for addressing high rents that are straining its business, the sources cautioned. Filing for bankruptcy would be one option to deal with expensive leases, the sources said.
The retailer’s flagship department store on Madison Avenue in Manhattan has weighed on its finances, one of the sources said. The sources asked not be identified because the deliberations are confidential. “At Barneys New York, our customers remain our top priority and we are committed to providing them the excellent services, products, and experiences they have come to expect,” the company said in a statement.
“We continue to work closely with all of our business partners to achieve the goals we’ve set together and maximize value. To that end, our board and management are actively evaluating opportunities to strengthen our balance sheet and ensure the sustainable, long-term growth and success of our business,” the company added.
Should it file for bankruptcy, Barneys would be one of the most high-profile victims of the downturn in retail, and underscore how even luxury department stores are not immune from fierce competition with e-commerce firms such as Amazon.com Inc. — Reuters
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