Our favorite struggling department store, Barneys New York, got more bad news this morning: Its parent company, Istithmar, is going to have to pump another undisclosed amount of cash into the debt-ridden retailer. (That’s according the the NY Post.)
Istithmar, a Dubai-based private equity firm, bought Barneys three years ago for way too much money–$942 million–and the value of the retailer has continued to decrease. While luxe department stores like Neiman Marcus and Bergdorf Goodman have been able to bounce back (even just a little) from the recession, Barneys continues to struggle.
And it’s not for lack of a great brand and great clothes. The problem still goes back to this: No one is running the business. Shareholder Ronald Burkle still wants to buy the company, but Istithmar won’t give up.
We really hope Burkle gets his hand on it sooner than later–he’ll do a great job–but even if Barneys is forced to file for bankruptcy, don’t fret. While smaller outlets across the country may close, Barneys itself will be around for a long time. It has too much future potential–someone is bound to bail it out.