New York Times article New Jersey’s Barneys has been selling off its stock of luxury goods, like its Chanel bags and Gucci shoes, for years.
But on Thursday, the retailer sold its entire line of luxury products to a group of Chinese investors.
The deal is the largest in the retailer’s history.
The Chinese investment group, which also owns a number of brands, including Tiffany & Marshalls, is buying the entire line.
The purchase represents a significant investment for Barneys, which is valued at $1.2 billion.
Barneys chief executive Ed Cohen told investors in a conference call Thursday that the deal with the Chinese investment company is worth more than $3 billion, a total that would make it the world´s largest retailer of luxury items.
The company also plans to buy an undisclosed number of shares of Alibaba Group Holding Ltd.
and sell those to investors, the New York-based retailer said.
The deals are the latest in a string of Chinese investments in the US and elsewhere in the world.
Last year, the country signed a $600 million deal to acquire stakes in American media company Hearst Corp. The acquisition of Barneys comes at a time when the company faces a barrage of criticism from investors over its pricing of its clothing, shoes and electronics.
Barney, which has been struggling with rising costs in China, has been trying to shift to a more consumer-friendly strategy, which some analysts say is aimed at helping it cut costs while still catering to the countrys wealthy elite.
In its quarterly earnings call last week, Barneys Chief Financial Officer Brian Wieser said the company planned to continue to make investments in its luxury goods and services, including a new brand, and that it would “continue to aggressively pursue opportunities to grow and enhance its brand.”
Barneys stock fell 7.4% in after-hours trading Thursday, after falling more than 8% on Thursday.
The stock is down about 9% from its IPO price of $1 in October 2016.