LOS ANGELES, Nov. 14 (UPI) — American Apparel on Monday filed for Chapter 11 bankruptcy protection, the second time it has done so in more than a year, court documents show.
Gildan Activewear, a Canadian clothing manufacturer, has agreed to a $66 million deal to acquire American Apparel’s intellectual property assets and inventory, court documents said.
“The company faced unfavorable market conditions that were more persistent and widespread than the debtors anticipated,” American Apparel chief restructuring officer Mark Weinsten said in a court filing. “These market conditions were particularly detrimental to retailers.”
The youth-focused fashion retailer exited bankruptcy protection in early 2016 but its latest attempts to turn around losses failed. The company in late September reported a 33 percent drop in sales from last year and $215 million in debts.
Stores will remain open while American Apparel attempts to sell locations. The company has 110 stores in 28 states and Washington, D.C.
