One day after its bankruptcy filing, Barneys New York has announced that it has secured approximately $218 million in new financing from Brigade Capital Management and B. Riley Financial to facilitate a going concern sale process.
This new agreement, which materialized earlier in the day, replaces the previously announced $75 million agreement with affiliates of Hilco Global and the Gordon Brothers Group and will refinance all of Barneys New York’s existing secured debts.
The luxury specialty retailer also received approvals from the United States Bankruptcy Court for the Southern District of New York to immediately access $75 million of the $218 million in new financing from Brigade Capital and B. Riley Financial, which, combined with operating cash flow, will help Barneys New York to meet its go-forward financial commitments and continue operations.
“We are pleased to partner with Brigade Capital and B. Riley Financial, whose substantial financial commitment will better support Barneys New York as we continue to offer a unique customer experience, strengthen our relationships with our vendors and conduct a sale process to position Barneys New York for the long-term,” said Daniella Vitale, chief executive officer and president. “This significantly enhanced financing commitment demonstrates the belief of Brigade Capital and B. Riley Financial in the value of the Barneys New York brand and business. We appreciate the prompt action by the Court in approving our first-day motions and would like to thank our employees, vendors, and customers for their continued support.”
Vitale continued, “I would also like to thank Hilco Global and the Gordon Brothers Group for their interest and professionalism. The competition to provide Barneys New York with fresh capital – a substantial amount of which is being provided on a junior basis – reinforces our confidence in achieving a value-enhancing transaction.”
As we reported yesterday, Barneys will continue to operate five flagship locations: Madison Avenue, Downtown NYC, Beverly Hills, San Francisco and Copley Place in Boston, as well as two Barneys Warehouse locations, including Woodbury Common and Livermore. In addition, Barneys.com and BarneysWarehouse.com will remain operational. A total of 15 of the retailer’s stores will close, however.