A California-based footwear and apparel company has confirmed it purchased local online retailer Karmaloop LLC, less than a year after the once-promising maker of street clothes emerged from bankruptcy protection.
The two investment companies that bought Karmaloop out of bankruptcy in May 2015 for $13 million, Comvest Capital of West Palm Beach, Fla. and CapX Partners of Chicago, sold the maker of hip street clothes to Shiekh Shoes. Terms of the deal were not disclosed.
“There is a tremendous opportunity to retell the Karmaloop story and grow the brand,” Shiekh Shoes president Matt Fine said in a statement. “We see additional opportunities to leverage the Karmaloop assets to grow our existing businesses in both the brick and mortar and e-commerce channels.”
Shiekh (pronounced chic) Shoes, through a public relations firm, declined to comment further. The privately-owned company was started by Shiekh Ellahi in 1991. Based in Ontario, Calif., it has 136 stores in 10 states, primarily on the West Coast, and online at shiekhshoes.com.
Karmaloop was started by Greg Selkoe in his parents’ Jamaica Plain basement in 1999 and quickly grew it on sales of urban chic fashion. The company’s flashy side included customers such as pop singer Pharrell Williams and parties at clubs in New York and Las Vegas.
But after a series of poor business decisions and shrinking sales, the company filed for bankruptcy in March 2015 with $100 million in debt. He was removed as chief executive last year.
Selkoe said he had talked to the new owners by phone last week, and they told him they intend to revive the brand and “return it to its former glory.”
The clothing entrepreneur is locked in a fight with Comvest, which is suing Selkoe to recover $5 million.Katheleen Conti can be reached at firstname.lastname@example.org. Follow her on Twitter @GlobeKConti. Megan Woolhouse can be reached at email@example.com. Follow her on Twitter @megwoolhouse.