Business

American Apparel is sold at auction to Canada’s Gildan Activewear

For years, American Apparel proudly touted its Made in Los Angeles motto. With its sale Tuesday to a Canadian sportswear firm, neither American Apparel’s name nor its motto will ring so true.

Gildan Activewear agreed to pay $88 million in a winning auction bid for the American Apparel brand and some manufacturing equipment, the company said Tuesday. The deal for American Apparel, which filed for bankruptcy in November for the second time, still requires approval from a Delaware bankruptcy court judge Thursday.

Gildan did not buy any of the company’s 110 retail stores in the US. Those stores are likely to close within a few months, analysts said.

Glenn Chamandy, chief executive of Gildan, said that American Apparel will be a strong complementary addition to its portfolio.

We see strong potential to grow American Apparel sales, he said in a statement. There is potential to drive further market share penetration in the fashion basics segment both in North America and internationally.

Gildan may keep some warehouse and manufacturing operations in Los Angeles, but analysts said that the vast majority of American Apparel factory workers in the Southland will be out of a job. In December, American Apparel notified nearly 3,500 Southland employees that they may lose their jobs. The message went to 332 workers in Garden Grove, 959 workers in South Gate and 2,166 workers at the company’s sprawling headquarters in downtown Los Angeles — via redwolf.newsvine.com

Share this Story
Load More Related Articles
Load More In Business

Leave a Reply

Your email address will not be published. Required fields are marked *

Photos from Flickr