By  on January 25, 2016

Bad past management, bad weather and bad inventory levels were all blamed at different points throughout last year for much of American Apparel’s bleeding balance sheet. Monday’s decision by a Delaware bankruptcy court judge to confirm the Los Angeles firm’s reorganization plan will allow it to emerge as a private company in a $230 million debt-for-equity swap with $40 million in exit financing and a $40 million asset-backed facility.

“This just gives us the opportunity to move forward and not be encumbered by a protracted bankruptcy, so for us it’s gone through very quickly in the scheme of things,” chief executive officer Paula Schneider told WWD Monday afternoon. “What it does allow is the freedom to move forward now [and] the ability to have some liquidity that we desperately need and make American Apparel stronger.”

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