American Apparel Inc announced that it has completed a $41 million secured debt financing with a private investment firm. The proceeds of the financing will be used for working capital and will fund the company's expansion plans. A part of the proceeds will also go to repaying the company's current credit facility with C3 Capital Partners, LP.
In conjunction with the financing, American Apparel has also negotiated a waiver agreement with its senior lender, U.S. Bank National Association, and an increase in the size of its senior credit facility from $57.5 million to $62.5 million.
“As the first major investment of institutional capital into American Apparel, this financing represents an important validation of our vertically-integrated business model,” said Dov Charney, CEO of American Apparel.
“This transaction places the company on a firm financial footing and allows us to pursue our ambitious growth plans, as well as our proposed merger with Endeavor Acquisition Corp. The hard work and dedication of our employees, and the support of our customers, vendors, and creditors, have been critical during American Apparel's rapid growth.”
On December 19, 2006, American Apparel and Endeavor Acquisition Corp announced the signing of a definitive merger agreement.
The proposed merger is subject to, among other things, Endeavor receiving an opinion from an independent investment banking firm that the transaction is fair to Endeavor's shareholders from a financial perspective, Endeavor receiving shareholder approval of the transaction, customary closing conditions, including receipt of an acceptable 2006 audited financial statement, and various regulatory approvals.
The transaction is expected to close sometime during the second half of 2007.
marketing@alchempro.com
