LOS ANGELES, Jan. 12 (UPI) -- Clothing manufacturer American Apparel received a buyout offer of $300 million from a group supporting its founder and former CEO Monday, the same day stakeholders approved its bankruptcy plans.
Dov Charney, who started the Los Angeles-based company in 1989 but was ousted as CEO in 2014 after allegations of sexual harassment and misuse of funds, backs the offer of funding from Hagan Capital Group and Silver Creek Capital Partners. The investors said their offer was an "upward revision" from a bid submitted in December, and would take the company private, with approximately $160 million of liquidity and new equity. A statement Monday left unclear whether Charney would return to lead the company. American Apparel saw declining revenue under his leadership but suffered more serious losses after he left. The company lost $65 million in the first nine months of 2015.
Hagen-Silver Creek offer is at odds with a bankruptcy plan calling for a reorganization under which American Apparel would trade about $200 million for equity, shareholders effectively losing their entire investments. Charney is the company's largest shareholder.
The matter will be resolved at a Jan. 20 bankruptcy court hearing.