American Apparel files for bankruptcy—again

The company’s chairman calls it ‘the best strategic move forward.’ Gildan Activewear has offered to buy some of the beleaguered retailer’s assets.

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On Monday, American Apparel filed for its second bankruptcy protection in 13 months.

The decision came after facing fierce competition and issues with its founder, Dov Charney—whom the company fired in 2014 after misconduct allegations surfaced.

Reuters reported:

… [American Apparel] emerged from bankruptcy in February under the ownership of a group of former bondholders led by hedge fund Monarch Alternative Capital LP.

Still, it continued to face declining sales, exacerbated by its costly manufacturing plant in Los Angeles. Under mounting pressure, American Apparel hired investment bank Houlihan Lokey earlier this year to explore a sale.

The move also comes months after the company considered a move to North Carolina or Tennessee, and less than a week after American Apparel’s UK team appointed administrators.

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