Gildan Activewear Wins American Apparel Auction With $88M Bid
Canadian apparel maker Gildan Activewear has won a bankruptcy auction for American Apparel after raising its offer to around $88 million, a person familiar with the matter said Monday. Gildan's takeover marks the end of an era for the iconic Los Angeles-based company, which was founded in 1998 by an eccentric Canadian university drop-out and grew to become a part of U.S. popular culture thanks to its racy advertising. Gildan will not take any of American Apparel's 110 stores, but will own its brand and assume some of its manufacturing operations, the source said. The deal is subject to a bankruptcy judge approving it on Thursday.
Total Retail's Take: The American Apparel saga appears to be winding down. While several companies bid for American Apparel, including Amazon.com, Forever 21 and Next Level Apparel, Gildan won out after increasing its original bid of $66 million to the winning bid of $88 million. The future of American Apparel's brick-and-mortar stores remain in question — my guess is they will also be sold to the highest bidder — but its brand and manufacturing operations, which are based in Los Angeles, will be under Gildan control. American Apparel burst onto the scene as a hip fashion brand, but in recent years has struggled with declining sales and frequent management changes.