- Vivian Hendriksz |
London - Boohoo has made its first step take over US rival Nasty Gal. The Manchester-based retailer has entered into an purchase process to acquire certain intellectual property assest from Nasty Gal for 20 million US dollars (16.2 million pounds).
The start of the sale process sees Boohoo launch its bid to acquire Nasty Gal brand and customer list, weeks after Nasty Gal filed for Chapter 11 Bankruptcy protection in the US. The agreement, which is subject to US court approval, sees Boohoo's subsidiary, Boohoo F I Limited, appointed as the "stalking horse" bidder for the Nasty Gal brand and customers database until January 5, 2017.
Boohoo makes first move to acquire Nasty Gal brand and customer database
Depending on US court approval, Boohoo will issue another update on or after the previously mentioned date. The bidding process for Nasty Gal is set to last at least 30 days, but Boohoo's bid for the fast-fashion brand may not led to a sale if the court receives higher or more favourable offers for Nasty Gal.
"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," said Mahmud Kamani and Carol Kane, joint CEOs of Boohoo. "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."
The confirmation of the sale of Nasty Gal comes just under a month after Boohoo filed a petition in the UK to incorporate Nasty Gal into its business. The fast-fashion retailer previously registered the business Nasty Gal Ltd with Companies House, naming its secretary Allan Pollitt as the company's secretary and director.
Founded in 2006, Los Angeles by Sophia Amoruso, Nasty Gal first started out as an eBay store for vintage clothing. Since then the brand has grown into an edgy, "fashion-forward" brand, which according to a statement from Boohoo, "would complement Boohoo's own inclusive and inspirational brand." The Manchester-based fashion company foresees the acquisition of Nasty Gal to accelerate its international growth, especially in the US, while building on Boohoo's existing customer reach.
Despite growing rapidly in its early years, Nasty Gal has faced its own struggles over the last few years. The US fashion retailer delivered net revenue of 77.1 million US dollars (62.8 million pounds) in the year ended 1 February 2016, but incurred a loss of 21 million US dollars (17.1 million pounds) during the same financial year before filing for Chapter 11 in November.
Photos: Boohoo website