Gildan Wins Auction For Racy Retailer American Apparel

(RTTNews) - Canadian apparel maker Gildan Activewear Inc., said it won a court-supervised bankruptcy auction to buy U.S. fashion retailer American Apparel's brand and certain assets for about $88 million in cash.

The transaction is subject to approval from a bankruptcy court on January 12, Thursday, the company said. Gildan expects to complete the acquisition by early February.

Under the deal, Gildan will acquire the worldwide intellectual property rights related to the American Apparel brand and certain manufacturing equipment. The deal, however, does not include any of the 110 American Apparel retail stores.

Gildan also said it will separately purchase inventory from American Apparel to ensure a seamless supply of goods to the printwear channel while the company integrates the brand within its Printwear business.

"We are excited to be moving forward with this acquisition. The American Apparel brand will be a strong complementary addition to our growing brand portfolio. 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.