Women’s clothing company Nasty Gal Inc. might have declared bankruptcy last month, but you wouldn’t know it by looking at its Twitter account.

The company continues to post cheeky memes and occasional links to its products, including faux-fur jackets and lace bodysuits. It’s this social media interaction, its brand recognition, and a large online following among female millennials that might be Nasty Gal’s greatest assets as it now courts potential buyers.

“Their target market is one that more mature retail brands are struggling to reach,” said Ari Bloom, chief executive of Avametric, a Bay Area company that makes 3-D content-creation software for apparel companies. “It’s an interesting opportunity if they can convert engagement into commerce. They may not have been successful financially, but that doesn’t mean their engagement can’t be further monetized.”

That could be what British online clothing company Boohoo.com sees in the downtown clothier, which makes 87 percent of its sales online, according to Nasty Gal’s bankruptcy filing. How to value the clothing company remains a question, however. It could fetch as little as $10 million, the reported value of its inventory, or as high as $80 million, its latest annual sales, as retail companies have been selling at around one times revenue, said Poonam Goyal, senior retail analyst for Bloomberg Intelligence.

Boohoo is the first company reported to be considering acquiring Nasty Gal since it filed for Chapter 11 protection last month. Nasty Gal, whose founder Sophia Amoruso’s rags-to-riches story has become part of the company’s brand, had been trying to find a buyer or investor since August 2014, according to court documents.

Manchester-based Boohoo, which is traded on the London Stock Exchange and had almost $250 million in sales this year, filed a request to incorporate a company named Nasty Gal Ltd. in the United Kingdom on Nov. 21, leading some observers to wonder if it was working on an early bid for Amoruso’s business.

Boohoo spokesman Richard Oldworth wouldn’t discuss the newly formed entity last week, but said in an email that some of the U.S. media coverage over the last week seems reasonably well-informed related to the Chapter 11 process.

Nasty Gal representatives didn’t respond to a request for comment.

Any purchase would have to be approved by a judge at the U.S. Bankruptcy Court for the Central District of California in Los Angeles. No sale requests appeared to have been filed as of Dec. 6, according to court records.

Fork in road

Nasty Gal and Boohoo have a few things in common – both online sellers started in 2006 and feature edgy, fast-fashion clothing – but took divergent paths.

Nasty Gal began life as an eBay business selling vintage clothes, and Amoruso used MySpace and other social media sites to cultivate a large online following. In 2012, it pivoted to selling its own brand of clothes.

In 2014, Amoruso published her bestselling autobiography, “#Bossgirl,” and hired Sheree Waterson, former chief product officer at Lululemon Athletica. But sales declined that year, and the company had revenue of $85 million for the year ended Jan. 31, 2015.

Nasty Gal hired Peter J. Solomon Co., a New York investment and advisory firm, to find a buyer or investment partner in August 2014, but that effort failed.

On Nov. 9 of this year, it filed for bankruptcy, listing $26.6 million in assets and $34.7 million in liabilities as of August.

Boohoo has met with more success.

Co-founded by fashion industry veterans Mahmud Kamani and Carol Kane, who now serve as joint chief executives, Boohoo differs from Nasty Gal in that it sells men’s and children’s clothes in addition to women’s.

The company grew from around $37 million in revenue in 2012 to almost $247 million this year. About 77 percent of its sales are in Europe and the United Kingdom, according to Bloomberg’s Goyal.

The company said last year in an earnings report that its greatest long-term growth potential was in the U.K., Australia, United States, Ireland, and France, so Nasty Gal’s fulfillment center in Louisville, Ky., could be attractive.

Millennial power

Where Nasty Gal has succeeded and some other apparel retailers have failed, on the other hand, is in connecting with young women.

“A lot of brands that were successful in the ’90s and aughts are getting older and having a hard time attracting millennials,” said Avametric’s Bloom. “An acquisition like this is an opportunity to connect to a young customer base.”

In May, teen apparel retailer Aeropostale Inc., which was founded in 1973, joined the ranks of teen retailers, including Wet Seal and Pacific Sunwear of California Inc., that have filed for bankruptcy in the past two years.

Part of the problem is the clothes have gotten stale and millennials tend to be brand agnostic, according to Goyal.

“That customer is not loyal,” she said. “They don’t care where they shop. They like the social media hype and want to look different than their classmates.”

As baby boomers age and shift their spending from things such as apparel to health care, millennials have become the next big demographic, said Goyal.

That age group spends $600 billion on retail and is projected to spend $1.4 trillion by 2020, according to professional services company Accenture.

Millennials also prefer to shop through social media sites. Nasty Gal has almost 1.3 million likes on its Facebook page, compared with almost 1.7 million for American Apparel, almost 8.3 million for Gap Inc., and nearly 2.4 million for Boohoo.

That number, along with Nasty Gal’s intellectual property, might be where the company’s value lies, said Julie Zerbo, who writes The Fashion Law blog about the business and law of fashion.

“For fashion brands and retail companies, so much of their inherent worth is IP based,” said Zerbo. “Largely what they’d be buying is the trademark, the goodwill associated with the trademark, the IP.”

Zerbo said she still isn’t sure how Nasty Gal would fare if it emerges from bankruptcy, given the company’s baggage, which includes poor online employee reviews and four lawsuits filed by former workers.

“I think it’s probably too early to say whether Nasty Gal can make a turnaround,” she said. “If it’s going to happen, a lot of things are going to have to be done differently – not just the business model.”

Bloom, however, is optimistic.

“They’re in a good position because they have a lot of potential to grow,” he said. “I think they’d be a very attractive acquisition for the right party. It’s really a matter of finding a complementary party that’s palatable to management and shareholders.”

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