Dubai''s Istithmar to acquire Barneys as Fast Retailing drops out

Dubai government''s investment arm Istithmar''s takeover of US store chain Barneys, known for its line up of upmarket clothes, appears certain with Japan''s Fast having said that it was pulling out of the race to.

Isthimar and Uniglo, Fast Retailing''s owner, have been battling it out since June, when Istithmar''s original offer received the backing of Barneys board. (See: Istithmar faces heat over Barney''s bid from Fast Retailing''s parent Uniqlo)

Fast Retailing withdrew its bid after Istithmar raised it offer to $942.3 million. Though it is below Fast Retailing''s $950 million, it is above the $825 million that Jones Apparel, Barneys'' parent firm, had accepted in June.

Pulling out of the deal with Isthimar, would involve Jones Apparel having to pay the Dubai investment agency $34.7 million.

Istithmar is the private equity arm of the Dubai government''s Dubai World. It has already made a number of investments in the US, including the Loehmann''s chain.