NOT SO FAST: Kanye West and Damon Dash are just two of several individuals who have checked in with Karmaloop founder Greg Selkoe regarding their interest in buying the now bankrupt streetwear e-tailer. Late last week the duo took to a series of 15-second Instagram videos discussing their intent to buy Karmaloop.
Given the bankruptcy, even if they do get selected as the stalking horse bidder, there’s no guarantee that they’ll get the company. Bankrupt firms that are planning to be sold need to go through a court auction where the stalking horse can be outbid by a better offer. An auction is likely to occur sometime next month.
Karmaloop filed a voluntary Chapter 11 petition for bankruptcy in a Delaware court last Monday. It stated in its petition that it had between $10 million and $50 million in assets and between $100 million and $500 million in liabilities. Selkoe told WWD the problem was due to debt from failed ventures, while the core business remains solid.