American Apparel is about to become Canadian Something Else. Purchased by Montreal-based Gildan Activewear, all of the once-popular clothing retailer’s 110 stores will be closing, as well as its LA-based HQ and factories. The news follows on the heels of last year’s firing of founder Dov Charney over alleged sexual harassment of employees, and bankruptcy filings thereafter.
The buyout includes intellectual property rights and some manufacturing equipment, but none of the leases for manufacturing or distribution locations, meaning the brand may continue to produce, but how and where it will be built, sold and managed is yet to be determined.
So, basically, yeah, you’ve got mere days to hit up your local Am App and stock up on the staples like headbands, tights, high-waisted everything and crop tops.
“This was always about buying assets out of bankruptcy,” said Gildan spokesman Garry Bell to the LA Times. “The reality is this wasn’t a purchase of an ongoing concern.”
As bad as this news is for consumers, it’s surely worse for the near 3,500 factory and HQ employees in the company’s former home in Southern California. They will likely be out of work in as little as a week.
Gildan Activewear made the purchase for $88-million US and will add the brand to its portfolio that includes Gold Toe socks, Silks hosiery, and licensing agreements with Under Armour, Mossy Oak and New Balance.
“We see strong potential to grow American Apparel sales by leveraging our extensive printwear distribution networks in North America and internationally to drive further market share penetration in the fashion basics segment of these markets,” said Glenn Chamandy, president and CEO of Gildan, in a press release.
This whole thing has shades of a bad breakup, leaving us feeling confused and wondering how much clothing we should stuff into our bags before the split is finalized.