You Tube

Skip Navigation LinksHome > Industry News
SHARE & BOOKMARK
FaceBook Twitter Delicious Digg LinkedIn

Charney Increases Stake In American Apparel

(7/1/2014)

Dov Charney, the recently deposed CEO of Top 40 supplier American Apparel (asi/35297), says he has increased his stock in the company he founded to nearly 50% of the organization’s total shares. Charney had owned 27.2% of the company’s shares when he was removed from his role as CEO two weeks ago, and he acquired an additional 15.78% of the company’s shares on Friday.

That transaction, which brings Charney’s total shares of American Apparel to 42.98%, was secured for Charney through a loan agreement with hedge fund investor Standard General. Under the agreement, Standard General would buy American Apparel stock and then would lend Charney the money to buy the stock from the investment firm at an annual interest rate of 10%. Late Monday, Standard General reported to the SEC that on Thursday and Friday it purchased 27.4 million shares, which it sold to Charney. On Monday, it bought an additional 1.5 million shares, or less than 1% of the company's shares.

Following the company's annual meeting on June 18, the American Apparel board voted unanimously to replace Charney as chairman immediately and "notified him of its intent to terminate his employment as president and CEO for cause.”

Now, as Charney is fighting to regain control of his company, American Apparel’s board this past weekend adopted a so-called poison-pill strategy for one year. The tactic was put in place by a special committee of the board, which said it would limit the ability of any shareholder "to seize control of the company without appropriately compensating all American Apparel stockholders."

"They now have an out-and-out war going on with their former CEO and by far largest shareholder," said Lloyd Greif, chief executive of investment banking firm Greif & Co., to the Los Angeles Times. "If he is at 43%, he is within spitting distance of actual control."

Charney has been a member of the Counselor Power 50 since the list's inception in 2006. American Apparel ranks as the 14th-largest supplier in the industry, and reported its promotional market revenues for last year as $99.2 million.



Sponsored By:

Making You Money: What ASI is all about.

Promotional products, also known as ad specialties, make up a $20.5 billion dollar industry and are used by virtually every business in America. Why? Items like mugs, pens and t-shirts are memorable and provide a better cost per impression for advertisers than almost every major marketing effort like prime time TV, magazines and radio.

With so many businesses buying ad specialties there is a huge opportunity for professionals looking to make great money running a promotional products distributorship. It’s easy and inexpensive to get started and you can work from home.

© 2014, The Advertising Specialty Institute®. All Rights Reserved.

  • A business opportunity to reinvent your career in an exciting field
  • Work at home - for yourself - not by yourself
  • Make money selling ad specialties
  • Partner with a time-tested industry leader
  • Get started instantly with all the tools you need