Will Barneys New York survive its second tour of bankruptcy proceedings?
The answer could come some time after 5:00 p.m. EST next Thursday.
Barneys had until this past Wednesday to find a buyer, but its lenders agreed to extend the deadline through Oct. 3 before pulling the plug if no buyer emerges. A telephone conference Friday gauged the status of Barneys’ search for a suitor.
While Barneys’ bankruptcy counsel indicated that it was in contact with prospective buyers, an attorney representing the retailer’s lenders said there’s a hard deadline of 5:00 p.m. on Oct. 3 to wrap things up before a liquidation process begins, according to a Debtwire report on Friday.
At their discretion, lenders could modify the deadline, but they probably would want concrete proof that a deal was in the works before granting another extension.
Reports first surfaced Thursday that Barneys has garnered buyers interested in acquiring its assets. Liquidators typically line up to throw their hat into the ring for the right to liquidate the bankrupt firm.
There’s also an investment firm that has experience in acquiring the assets of retail bankruptcies that has been snooping around as well. However, it is believed that none of those who have expressed interest has signed a confidentiality agreement that would allow them to dig a little deeper into Barneys’ operations.
And certainly no one yet has been named as the so-called “stalking horse,” an important development because the terms of any such deal would set a baseline for other offers to come in at a court auction.
On Aug. 6 Barneys filed a voluntary Chapter 11 petition for bankruptcy protection in a Manhattan court sitting in Poughkeepsie, N.Y.
Even before Barneys filed, CEO Daniella Vitale has been trying for months to find a buyer. She’s one of two executives who recently received bankruptcy court approval to receive a bonus if she can find a buyer to acquire the company as a going concern.
Currently, if Barneys secures a buyer the plan is to keep a handful of stores–including the Madison Ave. flagship and a Chelsea location in New York, and Beverly Hills and San Francisco in California–open as the bankrupt company shutters stores in Chicago, Las Vegas and Seattle. Barneys will also close five smaller concept stores and seven Barneys Warehouse locations.