Report: American Apparel in talks to hire restructuring firm
New York City American Apparel has been pressed by its banking facility to bring in an outside restructuring firm, according to a late Friday report by Reuters.
The report said that lender Bank of America pressured American Apparel to hire a specialist in corporate turnarounds, but that the firm is not being brought in to arrange a bankruptcy, but to help shore up the business.
The firm has not yet been identified, but Reuters said it has been meeting with American Apparel founder and CEO Dov Charney and his executives.
The report also said that American Apparel still has room to fix its fiscal woes, and while the situation was serious, a bankruptcy filing was unlikely for now.
The 279-store apparel retailer in August said it would likely be in default by the end of September on its loan agreement with U.K.-based lender Lion Capital.
The company and its executives were also recently slapped with a lawsuit by shareholders claiming they were misled about American Apparel’s true financial condition.
Charney has a controlling stake of 53% of American Apparel. Billionaire investor Ron Burkle purchased a 6% stake earlier in the summer.
German court approves Karstadt takeover plan
Berlin A German court has given the go-ahead for an investor to take over the country’s bankrupt Karstadt department store chain with its 25,000 employees, according to a Friday report by the Associated Press.
Karstadt has been under an insolvency administrator since parent Arcandor AG filed for protection in June 2009.
The German news agency DAPD reported that an administrative court in Essen on Friday approved a plan for financial investor Nicolas Berggruen to take over the chain. Berggruen was chosen to take over Karstadt in June but the plan then got delayed while negotiating over rent levels for its approximately 120 stores.
An agreement by the buildings’ owners to lower rents paved the way for a final deal this week, according to AP.
Duckwall-Alco same-store sales dip in August
Abilene, Kan. Duckwall-Alco Stores said late Thursday that same-store sales dipped 0.8% in August.
Total revenue rose 1.1% to $33.4 million due to improved inventory control, higher productivity and stronger marketing, said the company.