Dormify filed for Chapter 11 bankruptcy protection in November 2024 and is currently locked in a legal dispute with its creditors, including Google and Williams-Sonoma.
Williams-Sonoma (WSM) is close to acquiring the intellectual property of bankrupt Dormify, a startup that sells decor for dorm rooms and small spaces, according to Jefferies.
According to the gist of the investment firm's note on The Fly, Williams-Sonoma emerged as the top bidder for those assets late last month.
This potential deal is small in scale, but is a testament to CFO Jeff Howie's disciplined approach to M&A with clear guardrails in place to ensure a high return on investment (ROI), Jefferies reportedly said in a note to investors.
Dormify filed for Chapter 11 bankruptcy protection in November 2024 and is currently locked in a legal dispute with its creditors, including Google (GOOGL) and Williams-Sonoma.
Dormify has alleged that Google attempted to deduct or collect money related to ad services or unpaid invoices after the bankruptcy filing, which would violate the law.
A hearing on the case took place on Monday.
If Williams-Sonoma succeeds in buying Dormify's IP, it will be able to tap into the latter's college students and Gen Z audience, as well as its digital strategies.
On Stocktwits, retail sentiment for Williams-Sonoma rose to 'bullish' from 'neutral' the day prior.
The company's shares are down nearly 6% year to date.
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