New York City Billionaire investor Ronald Burkle is setting into motion plans to take a controlling stake in Barneys New York, according to a Friday report in Wall Street Journal.
According to the Journal report, which cited sources familiar with the situation, Burkle’s investment firm Yucaipa Cos. bought up a large chunk of Barneys' debt late last year and has offered to invest at least another $50 million in the high-end fashion chain via a loan deal that would leave Burkle owning 80% of Barneys' common equity.
The remaining equity would be held by Barneys' current owner, Istithmar World Capital, the investment arm of state-owned Dubai World, according to WSJ.
However, a person close to Istithmar said Burkle's proposal isn't under consideration. Also, Burkle hasn't had any talks with hedge-fund manager Richard Perry, whose firm holds a controlling position in Barneys' senior debt, one person familiar with the matter said. Perry Capital, Perry's firm, would have to sign off on any major debt restructuring.
Burkle made the offer in a Dec. 11 letter, reviewed by The Wall Street Journal, to David Jackson, who was Istithmar's chief executive at the time.
"This is private correspondence between ourselves and Istithmar," a spokesman for Burkle said. "We are surprised that it ended it up with the Journal and don't think any comment is appropriate."