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10 Nov

Posted at 15:09h in Business
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EDEN, N.C.—Gildan Activewear Inc. invests $23.1 million in the expansion of its Eden, North Carolina, distribution center. The Eden facility, which opened in 2000, services the company’s printwear business division and is the company’s “logistics hub for our North American operations and supply chain,” states Nick Freitag, vice president of distribution for Gildan’s printwear division. The company ships its printwear products to more than 30 countries around the globe, although the vast majority of shipments from its Eden site stay in North America, he says. Gildan’s expansion plans include spending as much as $12.7 million on machinery and equipment and another $10.4 million in building improvements. Once construction is complete, the building will be close to 1.2 million square feet. The project is slated to be completed by the end of 2015. “This is their fourth expansion in four years,” says Mike Dougherty, director of economic development for the city of Eden. He adds that the company is the region’s third-largest employer, behind the local hospital and the Miller-Coors plant. Both the city and Rockingham County put up economic incentives to encourage Gildan’s expansion. The county is putting in $448,720 and the city of Eden is putting in $392,630, with both sums to be paid in annual installments throughout the next four years. “The county and the city of Eden have always been supportive of our operations and expansion phases, which has included incentives for our previous expansions, depending on the scale of Gildan’s investment and the number of jobs it created,” Freitag writes in an email to Printwear. This latest expansion adds 16 new full-time jobs to the site’s existing 310 employees. But Dougherty says the incentives had as much to do with the capital expense Gildan is putting into the site as it did to the jobs being added. He calls the apparel company a “good employer” and a “great corporate citizen.” Along with distribution, the Eden facility also houses quality assurance employees, Freitag says. Aside from Eden, Gildan has additional presence in other North Carolina cities with yarn-spinning operations and a $142 million plant under construction in nearby Mocksville that will employ nearly 300 people when it opens in 2016. Gildan, which is headquartered in Montreal, has its manufacturing operations in Central America, the Caribbean Basin, and Bangladesh....

10 Nov

Posted at 14:49h in Business
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LOS ANGELES—American Apparel on Monday announced it is filing for Chapter 11 bankruptcy protection in order to relieve itself of debt and continue its operations without interruption. Under terms of the filing, which has been approved by the company’s board of directors but still requires approval by the U.S. Bankruptcy Court for the District of Delaware, the company would reduce debt and interest payments by more than $200 million in exchange for secured lenders acquiring equity interests in the form of bonds in the reorganized company. The company says its retail stores, wholesale, and U.S. manufacturing operations will continue to operate as normal throughout the restructuring, which is expected to take about six months. “This restructuring will enable American Apparel to become a stronger, more vibrant company,” says CEO Paula Schneider in a company-issued statement. “By improving our financial footing, we will be able to refocus our business efforts on the execution of our turnaround strategy as we look to create new and relevant products, launch new design and merchandising initiatives, invest in new stores, grow our e-commerce business, and create captivating new marketing campaigns that will help drive our business forward.” Schneider is a fashion industry veteran who was brought in by American Apparel’s board of directors following the ouster of the company’s controversial founder, Dov Charney. “This process will ultimately benefit our employees, suppliers, customers, and valued partners,” Schneider says in the statement. “American Apparel is not only an iconic clothing brand but also the largest apparel manufacturer in North America, and we are taking this step to keep jobs in the U.S.A. and preserve the ideals for which the company stands. In partnership with our bondholders, we can work towards a new future for the company and concentrate on what matters: making and selling great clothing.” On the same day the bankruptcy was announced the company also said the New York Stock Exchange had notified it that it was suspending the trading of its common stock and had begun proceedings to delist the stock from the exchange. The company says it will not appeal that decision. As the company stated in its bankruptcy filing, if the bankruptcy court agrees to the restructuring agreement the company has forged with some of its creditors, American Apparel's common stock will become worthless and holders of the stock will receive no compensation. The largest of those shareholders – holding about 75 million shares, or more than 41 percent of the company – is Charney.  ...