The Canadian apparel maker said in a statement Tuesday that it emerged as the winner in an auction to acquire the American Apparel and some of its assets for $88 million—higher than its initial $66 million offer.
As part of the deal, Gildan will acquire American Apparel’s worldwide intellectual property rights and certain manufacturing equipment. Gildan will also make a separate purchase of American Apparel’s inventory to “ensure a seamless supply of goods” as the company integrates the brand into its printwear business.
Gildan will not be buying any of American Apparel’s physical store assets.
“We are excited to be moving forward with this acquisition. The American Apparel brand will be a strong complementary addition to our growing brand portfolio,” Gildan president and CEO Glenn Chamandy said. “We see strong potential to grow American Apparel sales by leveraging our extensive printwear distribution networks in North America and internationally to drive further market share penetration in the fashion basics segment of these markets.”
American Apparel filed for bankruptcy the same day that Gildan placed its initial bid to buy it on Nov. 14 after struggling with sluggish sales and steady negative press tied to its founder and former CEO Dov Charney.
Amazon and Forever 21 had reportedly put bids in to the buy the company, and their offers may have been what drove Gildan up $22 million from its initial bid.