American Apparel As We Know It Is Over
Following the sale of its intellectual property to Canadian brand Gildan Activewear, the retailer is closing its L.A. headquarters and all 110 U.S. stores.
So long, American Apparel.
The L.A. Times first reported that the brand will be closing its L.A. headquarters and closing all 110 of its remaining U.S. store locations by the end of April. The news comes just days after Canadian brand Gildan Activewear won an auction to acquire American Apparel's intellectual property and some of its manufacturing equipment for $88 million. The acquisition did not include stores. Closures could result in the loss of as many as 3,400 factory positions.
The brand, which was founded in 1989, prided itself on its "Made in America — Sweatshop Free" logo. At its height, the company had more than 230 stores nationwide, and often found itself at the center of controversy over its racy ad campaigns.
Following rumors of an impending sale, orchestrated by American Apparel’s board of directors, CEO Paula Schneider stepped down from her position in September. The retailer filed for its second bankruptcy the following month; shortly thereafter, Gildan put forth its initial $66 million bid, which was ultimately raised to $88 million after interest from Next Level Apparel.
Schneider was appointed in 2014 after Dov Charney, founder of American Apparel, was ousted due to a string of sexual harassment allegations. Charney contested the allegations at the time, and was involved in numerous lawsuits over the terms of his dismissal. After a $300 million takeover bid by Hagan Capital Group, backed by Charney, was rejected in 2016, the SoCal-based businessman stated that he would be building a new made-in-L.A. brand.