Following its investor statement a couple of months ago, controversial retail giant American Apparel has officially filed for bankruptcy protection this week. The company’s issues have been played out publicly in recent years and culminated in a dire financial report back in August, which has now lead to the filing. It should be noted that this is another Chapter 11 filing – much like 50 Cent’s recent case – and its stores and employees shouldn’t be affected internationally. The main losers here will be the company’s current shareholders, including embattled former CEO Dov Charney’s estimated $8.9 million worth, with AA’s creditors being given full control of the company.
Current CEO Paula Schneider said “Our debt load simply wasn’t sustainable. You can’t do a turnaround plan without cash… Not having the nuisance lawsuits, not having this massive debt, these are all extremely important things for the company to thrive.” Looks like we’ll still have plenty of disco pants and lace bodysuits in our lives in future.
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