Boohoo seeks to acquire Nasty Gal
Nasty Gal filed for Chapter 11 Bankruptcy Code protection in the US Bankruptcy Court on 9 November. Subject to US court approval, Boohoo’s subsidiary Boohoo F I Limited will be appointed as the "stalking horse" bidder for the Nasty Gal brand and customer databases, in accordance with Section 363 of the United States Bankruptcy Code.
The sale of the Nasty Gal assets will be governed by a court approved bidding process lasting at least 30 days. Boohoo said its bid may not result in a transaction if higher or more favourable offers are obtained by Nasty Gal during the auction process.
Founded by Sophia Amoruso in 2006, Nasty Gal delivered net revenue of US$77.1 million in the year ended 1 February 2016. This includes revenue from vintage clothing and third party brands, which are excluded from the proposed transaction. The company made a net loss after tax of US$21.0 million after taking into consideration operating costs. The proposed transaction relates to the acquisition of intellectual property assets only and excludes all operating costs.
Boohoo said the acquisition of the fashion forward brand would accelerate its international growth, particularly in the US, as it looks to build on its existing customer reach and product range across the globe.
Mahmud Kamani and Carol Kane, Boohoo joint chief executives, said: “Should we be successful in acquiring Nasty Gal it would represent a fantastic opportunity to add such a well-established, global brand to the Boohoo family. Following our recent acquisition of PrettyLittleThing.com we believe this would represent an ideal next step in inspiring an ever-growing range of young customers internationally."
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