American Apparel files for bankruptcy in the US
American Apparel had not made a profit since 2009
![](https://static.independent.co.uk/s3fs-public/thumbnails/image/2010/08/21/23/437086.jpg)
Support truly
independent journalism
Our mission is to deliver unbiased, fact-based reporting that holds power to account and exposes the truth.
Whether $5 or $50, every contribution counts.
Support us to deliver journalism without an agenda.
![Louise Thomas](https://static.independent.co.uk/static-assets/support-us/louise-thomas.png)
Louise Thomas
Editor
American Apparel has capped a year of turmoil by filing for chapter 11 bankruptcy in the US.
The brand said it had the support of 95 per cent of its secured lenders for restructuring. However the company said that stores should stay open as usual and that manufacturing would continue.
American Apparel has made headlines in the past year for legal battles with its former boss and founder Dov Charney.
The bankruptcy filing, which had been anticipated by many in the industry, follows a chaotic period in the company's 26-year history.
It sacked Mr Charney as chief executive in December for alleged misconduct.
Charney has since fought back, launching several law suits against the company claiming defamation and breach of contract.
American Apparel had not made a profit since 2009.
The retailer said the restructuring will slash debt by $165 million (£108.4 million) to $135 million by eliminating $200 million in bonds in return for equity in the revamped company.
“By improving our financial footing, we will be able to refocus our business efforts on the execution of our turnaround strategy,” chief executive Paula Schneider said in a statement.
Some of American Apparel's adverts were banned by the Advertising Standards Authority in 2013 for being "overtly sexual" and "gratuitous", while another raised concerns about models being vulnerable.
Additional reporting by Reuters
Subscribe to Independent Premium to bookmark this article
Want to bookmark your favourite articles and stories to read or reference later? Start your Independent Premium subscription today.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments