American Apparel is like the spider you just can’t kill. Every time you think you’ve killed it for good, you see it scurrying away out of the corner of your eye, back to terrorize you another day.
Ron Burkle, the Los Angeles billionaire who bought a 6 percent equity stake last year only to slash it earlier this year, is now angling to take on the company’s debt load by backing an offer from Jason Taubman Kalisman, a 30-something heir to the Taubman real-estate empire, sources said. Burkle and his investing partner are looking to take over a $75 million credit line, currently provided by Bank of America, sources said. That facility is heavily drawn down, with just $1.5 million in availability for additional borrowings as of last month, according to securities filings.
One possible outcome is that an $84 million term loan from British-based Lion Capital — whose punishing interest rate of 18 percent has sapped American Apparel’s liquidity — could be partly or entirely refinanced to a rate as low as 7 percent, according to a person briefed on the talks. “There’s not a huge amount of urgency to get a deal done right now, because business trends are positive,” said one person close to the talks.
Why won’t you let Dov Charney just go away?! We were so close this time!
– Taneisha Jordan
Source: NY Post