American Apparel to receive 80m loan

Los Angeles-based American Apparel is to receive an $80m loan,

allowing the basic t-shirt chain to stay in business.

The brand, which supplies over 280 stores from its LA factories has seen its sales fall this year, due in part to disruption caused by the loss of over a quarter of its 7,000 workers following an immigration inspection.

Since going public in 2007, it has struggled to meet its financial reporting requirements, reported the Financial Times.

The new agreement exempts the company from meeting earnings targets for the remainder of this year, and sets new targets for 2011.

Lyndon Lea, founder of Lion Capital, AA's creditors, stressed his support for Dov Charney, American Apparel’s controversial CEO, and said it “wholeheartedly” supported its “made in the USA” strategy. He further added that Lion was working with the company to hire a number of new senior executives.