US-based apparel retailer American Apparel has filed for its second Chapter 11 bankruptcy in a little more than a year.
It has signed an agreement with Canadian company Gildon Activewear to sell its assets.
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American Apparel will sell its intellectual property rights and other assets to Gildan for $66m, reported Latimes.com.
According to the report, Gildan will only buy the inventory supply, not the outlets, and plans to integrate the acquired brand with its own operations.
American Apparel has 110 outlets in 28 US states, and more than 80 stores in international markets.
According to court filings, Gildan stated it 'has negotiated for the opportunity to maintain all or a portion of' American Apparel’s manufacturing, distribution and warehouse operations in Los Angeles.
Gildan corporate communications and marketing vice-president Garry Bell was quoted by Latimes.com as saying: “We feel like ‘made in America’ is an inherent part of that brand.
“It is our intent to continue that focus.”
Last year, American Apparel emerged from bankruptcy.
Under the bankruptcy process, other firms can also bid for American Apparel’s intellectual property rights and other assets.
American Apparel has close to around 6,000 employees across its global operations.
