US creditors intervene in Boohoo’s £16.3m IP bid for Nasty Gal
CREDITORS of bankrupt US fashion online retailer Nasty Gal are demanding a say in the £16.3m ($20m) sale of its intellectual property assets to Manchester-based Boohoo.com.
A committee of businesses owed money by Nasty Gal has lodged a “limited objection” with a bankruptcy court, according to WWD.
The objection will not block the deal, but it means the creditors want input in the sale negotiation to make sure the value of Nasty Gal’s assets are protected if the deal collapses.
The committee believes it is currently in the position of mere observers to the sale process.
“…while it appears that the committee will be allowed to witness the sale process and proceedings, unless the process is modified, the committee will be relegated to sitting in the bleachers with no binoculars,” its objection states.
Boohoo confirmed on December 28 that it was planning to make a $20m bid for certain intellectual property assets from the LA-based business which is in a Chapter 11 bankruptcy.
Boohoo said it would seek US court approval today for its subsidiary Boohoo F I Ltd to be appointed as the “stalking horse” bidder for the Nasty Gal brand and customer databases.
The sale of the Nasty Gal assets will be overseen by a court-approved bidding process that will last at least 30 days. Other bidders may enter the race, so it it is not a certainty Boohoo will win, but the stalking horse is generally the favourite.
Should its deal with Nasty Gal go ahead, it would be its second acquisition in as many months for Boohoo. Earlier in December it announced it had acquired a 66% stake in young fashion online retailer PrettyLittleThing for a cash consideration of £3.3m.
