Bergdorf Goodman is exploring a possible sale — and one doable final result is that it strikes to a shocking tackle close by, The Publish has discovered.
Neiman Marcus, which has owned the storied Fifth Avenue luxurious mecca since 1972, has been interviewing bankers, together with for a possible sale of Bergdorf, in a bid to lift money after rising from chapter in September, sources instructed The Publish.
In a shock twist, insiders say that among the many patrons within the 122-year-old division retailer is Ashkenazy Acquisition Corp. — the previous landlord of Bergdorf’s now-deceased luxurious rival Barneys. That’s as a result of Ashkenazy is on the prowl for tenants at its 660 Madison Ave., which Barneys vacated when it liquidated its shops in December 2019.
Talks between Neiman and Ashkenazy have “lately heated up,” in line with a supply with information of the scenario.
Neiman denied a sale however declined to touch upon whether or not the corporate has lately held discussions with bankers or potential bidders.
“We have now no intention nor are we seeking to promote Bergdorf Goodman at the moment,” a Neiman spokesperson stated. “We’re strategically investing in our enterprise and our manufacturers with the intention of rising and strengthening the corporate.”
A supply near the corporate added that Neiman will not be in “lively conversations concerning a sale.”
After all, Ashkenazy might get outbid in any public sale, which consultants predict might fetch upwards of $1.5 billion. Insiders say Bergdorf would possible entice curiosity from different huge names in luxurious — foremost amongst them Bernard Arnault, the billionaire whose French luxurious big LVMH scooped up Tiffany & Co. earlier this 12 months for $15.8 billion.
Arnault has “all the time been obsessed” with Bergdorf, in line with a supply near Neiman Marcus. If LVMH made a suggestion, it will possible need to purchase the actual property from the present landlord, the supply added. That’s as a result of the lease for the flagship girls’s retailer expires in 2050 — setting it up for a future lease hike just like the one which doomed Barneys.
A 3rd potential bidding bloc for Bergdorf, which in line with sources already has expressed curiosity, consists of WeWork founder Adam Neumann and Sam Ben-Avraham, who had bid for Barneys in 2019.
Reps for Ashkenazy and LVMH didn’t return a request for remark. Ben-Avraham by a spokesperson denied that he has expressed curiosity in Bergdorf Goodman.
Neumann declined to remark.
Insiders stated Bergdorf’s gross sales — which reached $650 million at their peak — plunged greater than 50 % in the course of the pandemic. Profitability, in the meantime, has tumbled to $20 million in Ebitda, or earnings earlier than curiosity, taxes and amortization, from a peak of $120 million.
“A purchaser can be shopping for into the potential quite than the efficiency of the model,” one supply near the corporate stated. “As a result of the corporate is doing so poorly. It’s been a battle.”
The purpose has all the time been to make Bergdorf a $1 billion greenback enterprise, a supply stated, however efforts to beef up digital gross sales have stalled.
One state of affairs being mentioned would contain Ashkenazy Acquisition becoming a member of a bunch that purchases Bergdorf. A bonus of the previous Barneys area, positioned on the nook of East sixtieth Road, is that it might home each the ladies’s and males’s departments in a single constructing, sources famous. At present, Bergdorf does enterprise on each side of Fifth Avenue at East 58th Road, with the larger girls’s retailer on the west aspect reverse the boys’s store on the east.
Within the meantime, Neiman has been elevating money and shoring up its steadiness sheet, exiting two main workplace leases close to its Dallas headquarters and promoting dear art work it owns, together with authentic Seventies sketches by Halston, images by late style photographer Invoice Cunningham and a trove items collected by Stanley Marcus within the Nineteen Sixties by the Nineteen Eighties.
In December, Neiman reaped $18.2 million from the sale of a giant cellular by Alexander Calder at a Sotheby’s public sale. The Calder had been displayed contained in the Hudson Yards retailer that closed completely final 12 months.
Neiman additionally refinanced debt in March, saying it had no borrowings on a $900 million credit score line and had $200 million in money.