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American Apparel restructures board


Embattled retailer American Apparel Inc. is restructuring its board amid rumors that the company is evaluating an offer to sell itself at a hefty premium.

The company, which recently ousted its chief executive and founder Dov Charney, announced that Allan Mayer and David Danziger have stepped down as co-chairmen of the board and will be replaced by board member Colleen B. Brown as chairperson. Mayer and Danziger will continue to serve as members of the board and will retain their positions as chairs of the compensation and audit committees, respectively.

Brown, who joined the board in August and has been serving as chair of the nominating and governance committee, brings years of experience as both a chief executive and board member of publicly traded companies.

"It's time to focus on the work ahead of us and push this company to reach its full potential," Brown said. "This is a pivotal moment for American Apparel, and I believe the company is poised for a significant turnaround. It will be very rewarding to work with an executive of newly appointed CEO Paula Schneider's caliber, and I thank Allan and David for their diligent efforts as co-chairmen of the board."

The company also announced that it has received an offer for $1.30 to $1.40 a share -- double the level shares were trading at before news of the offer sent shares soaring. The company said it is evaluating the proposal, which is backed by private-equity firm Irving Place Capital.

American Apparel has racked up more than $300 million in net losses since 2010, forcing it to raise money to make ends meet. Its most recent infusion came in July, when it received a capital commitment of $25 million from Standard General, a New York-based hedge fund.

American Apparel is has approximately 10,000 employees and operates 245 retail stores in 20 countries including the United States and Canada.

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