Departmental stores major Isetan to sell Barney's stake to Sumitomo
26 Jun '06
2 min read
Isetan has announced last week that they will be selling their entire stake in Barney's Japan to Sumitomo.
Isetan had established Barney's Japan with Barney's New York in 1989; a license agreement that gave Isetan exclusive rights to Barney's in Asia.
The initial plan had been to open 10 stores in Japan and another 10 in rest of Asia, but the reality was that Isetan had entered real estate investment.
Later in 1996, after Isetan had invested over 60 billion Yen through their American subsidiary, Isetan of America, Barney's aggressive management led Barney's to pledge for bankruptcy.
This all led to legal battles that settled with restructuring of Barney's and Isetan owning 7.3 percent of Barney's stakes.
Later in 1999, Isetan had purchased the entire stake in Barney's Japan and made it their subsidiary. Total loss caused by Barney's on Isetan was over 50BJYen.
Still, through this turmoil, Isetan had managed to completely change their management position, with the CEO of that period stepping down, and had received human resource from Main Bank Mitsubishi (Corporate name at that time), in their accounting division to watch over their whole finances.
They gradually climbed back to be one of the top department stores in Japan, and in 2001 declared that they will no longer need the bank's support service in human resource.
In 2005, Isetan had sold their 6 percent stake in Barney's New York to Jones's Apparel,and now will be selling their entire stake in Barney's Japan to Sumitomo Co, and Tokyo Marine Capital.
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