American Apparel is getting ready for a January bankruptcy auction of its business. The struggling retailer is all set to shutter nine of the worst performing stores by Jaunary.
According to a report in The Street: American Apparel is pushing for expedited closures of the nine stores so that it can avoid having to pay rent on them in January. The company has previously said in court papers that is losing $1-2 million a week and added in the motion that it could face as much as $200,000 in additional rent payments for January if the store closing sales at the nine locations were to be delayed.
The company, which has 107 retail locations in the US, will see the remaining 90+ stores being auctioned off, according to a report in The Wall Street Journal.
The Los Angeles-based retailer employees 4,700 people but it was not immediately clear how many of them would be affected by this.
American Apparel sought chapter 11 protection in November, its second filing in a little over a year, after a turnaround strategy failed.
The company also placed its 13 U.K. outlets into the equivalent of chapter 11 bankruptcy protection and is shutting them down.