Japan's Fast Retailing Co Ltd has raised its offer for Barneys New York to $950 million, topping a bid by Dubai government-owned Istithmar.

This was revealed by Barneys' owner Jones Apparel Group Inc.

Fast Retailing had initially offered $900 million for the luxury US retailer. Istithmar matched that bid earlier on Sunday.
  
Jones Apparel said in a statement released in New York that it intended to accept the Fast Retailing offer unless Istithmar matched it within two business days (by Aug. 6).   

Istithmar, owned by the government of Dubai, had earlier agreed to buy the luxury retailer for $825 million before Fast Retailing entered the fray with a $900 million offer.

Jones, which owns clothing, shoes and accessories brands such as Nine West, Gloria Vanderbilt and Jones New York, put itself up for sale last year but failed to find a buyer. It agreed to sell Barneys in June after several months of negotiations.

Under a June agreement with Istithmar, Jones Apparel's management can explore bids for the whole company through Aug. 11.

Barney's could be Fast Retailing's biggest purchase to date. Having built a chain of more than 700 stores in Japan, the Tokyo-based company plans to expand abroad, investing as much as 400 billion yen ($3.4 billion) on acquisitions to almost double its annual sales to 1 trillion yen by 2010.

Istithmar's investments on behalf of the Dubai government include a stake in Standard Chartered Plc. and buying luxury liner Queen Elizabeth 2. -Reuters