American Apparel Inc. is no longer facing a delisting threat from the NYSE MKT exchange.
The Los Angeles-based vertical retailer said Wednesday that it had received a letter from the exchange saying the firm has resolved a listing deficiency involving companies with “impaired operations,” which first drew the exchange’s attention in late February.
In addition to delaying the filing of its annual report, American Apparel had reported a dwindling cash position — with cash on hand down to $4.9 million as of Feb. 28 — and an anticipated net loss of $107 million in 2013.
The company achieved a semblance of equilibrium by selling 61 million shares of new common stock to the public last month for 50 cents each. FiveT Capital Holding AG, a Zurich-based investment fund, acquired about 22 million shares of American Apparel stock subsequent to the offering and now holds a 12.7 percent stake in the firm.
Shares closed Wednesday at 50 cents, down 0.6 percent, but rose 9.1 percent to 55 cents in after-hours trading following the disclosure of the resolution with NYSE.