American Apparel Files For Bankruptcy

After a tumultuous year and a half, American Apparel has filed for bankruptcy, it was revealed last night. Ongoing conflict with former CEO Doy Charney - who was fired by the firm last December - has kept the ailing retailer in the headlines as it has struggled to manage its mounting debts. By filing for Chapter 11 bankruptcy, the company is said to have slashed the debt from $300 million to $135 million, a move that it hopes will enable it to start rebuilding the brand.

"This restructuring will enable American Apparel to become a stronger, more vibrant company," said CEO Paula Schneider, reports WWD. "By improving our financial footing, we will be able to refocus our business efforts on the execution of our turnaround strategy as we look to create new and relevant products, launch new design and merchandising initiatives, invest in new stores, grow our e-commerce business and create captivating new marketing campaigns that will help drive our business forward."

Schneider, who was appointed in the wake of Charney's exit, has implemented a number of strategic changes as well as new operational processes that have been publicly criticised by supporters of Charney who have held a number of rallies calling for the controversial former CEO to be reinstated. All eyes will be on the company moving forward to see if its new tactic will reverse its fortunes.