American Apparel is granted extension for reorganization
31 Dec 2015
Los Angeles – In the past year, American Apparel has been facing daily struggles to remedy its business strategy. After filing for bankruptcy, introducing a turnaround plan, and negotiating with Oak NYC; the business has asked for an extension from a judge for their reorganization plan.
Luckily for the Los Angeles-based apparel company, American Apparel received a win. On December 28, as reported by Apparel News, U.S. Bankruptcy Judge Brendan L. Shannon approved the retailer’s plea for an extension. The extension allows for the company to have from February 2 to May 2 to reject store leases for its 125 operating stores. With the reorganization plan, the company is aiming to be out of bankruptcy by early February 2016.
A hearing for the confirmation of the plan is scheduled for January 20. The new plan is set to help restructure the company, get it back on the New York Stock Exchange, and also reduce the company’s overbearing debt. Though the extension has been approved, the company is still planning to shutter at least eight of its stores in the U.S. by the end of January.