— The Style File

The fate of American Apparel has been revealed

MARK RALSTON/AFP/Getty Images

Sealing the fate of an iconic — but flailing (and, over the years, problematic) — made-in-the-U.S.A. brand, American Apparel was purchased at auction yesterday by clothing wholesaler Gildan Activewear after filing for bankruptcy twice in the last two years.

The Canadian company, based in American Apparel founder Dov Charney’s hometown, Montréal, bought AA’s intellectual property rights — meaning, essentially, the right to its branding — and some of its manufacturing equipment for $88 million. Gildan said in a press release that it will separately purchase some of American Apparel’s inventory to “ensure a seamless supply of goods to [Gildan’s] printwear channel.”

The Gildan sale did not include any of American Apparel’s 110 retail locations, however, leaving many wondering where they’ll be able to purchase those oh-so-soft cotton basics.

While AA has famously manufactured its products in Los Angeles since 1997, 90% of Gildan’s employees are located overseas, mostly in the Caribbean and Central America. And according to the Los Angeles Times, it’s expected that Gildan will lay off the majority of AA workers in Southern California; American Apparel preemptively warned 3,500 employees in December about the possible layoffs.

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