American Apparel Emerges from Chapter 11 as Private Company

by Katie Sloan

Los Angeles — Los Angeles-based fashion retailer American Apparel has emerged from chapter 11 as a private company after successfully implementing its plan of reorganization, approved by the Delaware bankruptcy court in late January.

American Apparel’s reorganization plan converted approximately $230 million worth of bonds into equity, and provided for the infusion of $40 million worth of exit capital into the company. The reorganization plan also included a commitment for a $40 million asset-backed loan.

Under the reorganization plan, the company has also converted its corporate form, and will now be known as American Apparel LLC. Jones Day acted as American Apparel’s legal advisor in connection with the restructuring. FTI Consulting and Ducera Partners LLC served as American Apparel’s restructuring advisors, and Moelis & Co. served as investment banker for the restructuring. Milbank, Tweed, Hadley & McCloy LLP was the legal advisor to bondholders.

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