Have you ever walked into Barneys New York and wondered how you could afford anything on their shelves? If so, you may want to visit them again soon as much of their high-priced merchandise is currently on sale. The Dubai-based owners of the store are in some financial distress and they're actively looking to move as much merchandise as possible.
However, in-store sales may not yield enough cash for the owners, and now there is widespread rumors that the store itself will be put up for sale. Istithmar is the Dubai private equity firm that bought the store for $942 million in 2007, but at that time the price of oil was well north of $80 per barrel and they were flush with cash. With oil now fetching a meager $37 per barrel, the Dubai firm is feeling the squeeze, and may need to unload Barneys quickly if their cash position doesn't change in hurry.
With the current economic reality hitting every consumer in the pocketbook, one has to wonder if there will be a viable business for the foreseeable future for a luxury retailer like Barneys. Might we be seeing the end of this regal and distinguished luxury brand?
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