Dubai firm ups bid for Barneys

DUBAI investment firm Istithmar said yesterday it has upped its bid for US upscale retail chain Barneys New York to US$900 million, matching a rival bid by Japan-based Fast Retailing Co Ltd.The wrangling marks the latest twist for Barneys, a celebrated New York retailer started in 1923 by Barney Pressman which went through bankruptcy in the 1990s.Istithmar, the Dubai government's investment arm specialising in private equity deals, "has revised its offer to acquire Barneys New York, the luxury specialty retailer, from Jones Apparel Group Inc at a purchase price of US$900 million and under competitive terms in the share purchase agreement," a statement said."If this offer is not accepted Istithmar is entitled to our break-up fee of US$22.7 million," the statement said.Jones Apparel Group said last month it received an unsolicited US$900-million offer from Fast Retailing two weeks after initially agreeing to sell Barneys for US$825 million to Istithmar.On Wednesday, Jones Apparel Group said in a statement that its board had backedthe Fast Retailing offer and informed Istithmar of its intention to accept it unlessthe Dubai firm can match the offer. It said it would pay Istithmar a termination fee of US$22.7 million for scrapping the deal signed in June.Under the Jones group, Barneys operates flagship stores in New York, Beverly Hills, Chicago, Boston and Dallas as well as several regional "warehouse" stores and others under the Barneys Co-Op name.Istithmar had previously argued that the deal it signed with Jones Apparel Group was "definitive".Fast Retailing is aiming to overtake industry leaders such as Zara and Hennes and Mauritz (H and M) to become the world's number one in casual wear.Its Uniqlo brand flourished during Japan's decade-long slump in the 1990s by selling cheap yet good quality clothing, mainly manufactured in China.The chain has since branched out in China and Britain as well as France.Istithmar is owned by Dubai World, a conglomerate which is in turn owned by the government of the Gulf emirate of Dubai, one of the seven members of the United Arab Emirates (UAE).Its bid for Barneys follows a series of investments in the United States.In May last year, the firm announced it had bought for US$300 million the Loehmann of New York chain of shops which had gone bankrupt seven years earlier.In June the same year, Istithmar revealed it had bought a 32-storey building in Manhattan for US$1.2 billion, and in October last year it said it acquired the W Hotel Union Square in Manhattan for US$285 million.AFP