Once popular retailer American Apparel appears to be set to close with a recent liquidation auction concluding recently. The large retailer, which had reported sales close to $600 million at one time, had its intellectual property rights among other assets sold for $88 million to another company in the clothing business – Gildan. The sale marks the end of the once hip retailer seen in many malls and shopping complexes across the United States. Gildan also will reportedly pay $15 million more to acquire American Apparel’s purchase orders and inventory.
The sales mentioned do not include the retail establishments but those are expected to close. The company filed for bankruptcy twice in the last 13 months which ended with the latest purchase of assets. The company employs close to 5000 people and owns over 100 stores. No mention was made on how the employees would be handled as the new owner of property and assets are not obligated to keep all of them.
American Apparel has been in the news for the last few years due to a rocky relationship between the company’s board of directors and founder/chief executive officer Dov Charney. The former CEO put up a valiant fight to try and regain control of the company he founded but attempts to do so were futile. Charney racked up huge debts for the company which was ultimately taken over by a company within this time span. The ownership and change did nothing to stop a second bankruptcy filed last year. Charney started the company out of his college dorm room in 1989 and saw it expand to over $600 million in sales and 200 stores at its peak. Now it lays in ruins after the court hearing to liquidate its assets. Sales were reportedly over $5 billion total over the previous ten year period.
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