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Nasty Gal Bankruptcy: Clothing Retailer Files for Chapter 11

Image: Nasty Gal Bankruptcy: Clothing Retailer Files for Chapter 11

Nasty Girl founder Sophia Amoruso (L) and CEO Sheree Waterson attend Girlboss-Prudential Brunch at NeueHouse Los Angeles on Sept. 9, 2016 in Hollywood, California. (Randy Shropshire/Getty Images for Girlboss, Inc.)

By    |   Thursday, 10 Nov 2016 03:35 PM

Trendy clothing retailer Nasty Gal filed for bankruptcy in California on Wednesday in a move to restructure and streamline the business.

Chief Executive Sheree Waterson said the company needed to address what she called “immediate liquidity issues” and to correct high occupancy costs at some of its locations, the Los Angeles Times reported.

“We expect to maintain our high level of customer service and emerge stronger and even better able to deliver the product and experience that our customers expect and that we take pride in bringing to market,” Waterson said, the Times reported.

Founder Sophia Amoruso also resigned as the company’s executive chairwoman, according to Recode. Amoruso started Nasty Gal as a vintage clothing store on eBay when she was just 22, then grew it into an $100 million online business and opened two Los Angeles-area stores.

Nasty Gal made layoffs in 2015, but still has had trouble competing with national retailers like Forever21 that have more resources to bring new fashions to market quickly. Nasty Gal also has been the target of lawsuits by former employees who claim they were laid off for getting pregnant and for taking paternity leave, Us Magazine reported.

The company doesn’t expect customers or employees to see changes in daily operations, and it hopes to build “strategic partnerships with other strong brands,” according to the LA Times.

Nasty Gal also is seeking a new equity partner or sponsor to help it move forward as it emerges from Chapter 11, but plans to continue operating with or without that partner. Nasty Gal had been seeking a buyer but has decided not to sell at this time.

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Trendy clothing retailer Nasty Gal filed for bankruptcy in California on Wednesday in a move to restructure and streamline the business.
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2016-35-10
Thursday, 10 Nov 2016 03:35 PM
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