Barneys Seen Inching Closer to Bankruptcy

Time might be running out for Barneys New York, with industry sources fearing a bankruptcy could come as early as this week. The luxury department store acknowledged last week that it was “actively evaluating opportunities to strengthen our balance sheet and ensure the sustainable, long-term growth and success of our business.” That statement spooked an already nervous vendor base and sources said factors, a vital source of trade financing in fashion, have stopped approving orders to the retailer. While another investor could come in or other financial arrangements made, these solutions increasingly look like long shots. Two sources said a bankruptcy filing could come this week, with one indicating that it could come by Wednesday. “Because they went public with it, they kind of scared everybody off,” one industry source said, citing the company’s reaction to news reports. “My sense is that something’s got to happen quickly; I’m sure most people aren’t shipping to them. This is a pretty crucial time of year not to be getting receipts.” Barneys is continuing to explore the possibility of bringing in an investor or strategic partners to help improve its balance sheet, and is talking with landlords to renegotiate leases. It also doesn’t seem to have lost the confidence

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