American Apparel's Main Lender Is Appropriately Skeevy


American Apparel founder Dov “Pants-optional” Charney has been repeatedly sued for sexual harassment and he masturbated in front of a reporter. One wonders what their lenders think of this. Well, turns out they’re into eating sushi off naked chicks’ bodies.

Lion Capital holds around $80 million of American Apparel’s total $120 million in debt; they have been the troubled company’s largest creditor ever since the t-shirt concern first started experiencing credit issues, in early 2009. In fact, Lion’s loan effectively saved the company from bankruptcy.

Lion owns around 18% of American Apparel, and it has been unusually indulgent with its debtor. American Apparel has been so wracked by plummeting sales and spiraling costs that it has twice had to announce its inability to meet the terms of its obligation to Lion. In response, Lion restructured its loan once already this May; last month, American Apparel admitted it was again falling into default, and might not have enough cash to continue its operations through the next year. Lion is expected to work with American Apparel to restructure the loan again, possibly at the cost of even higher interest rates. (American Apparel is currently paying a whopping 17% interest.)

But what kind of a company is Lion, exactly? Aside from one that seems as interested in making questionable investments as Dov Charney is in making questionable legwear? The Guardian reports that Lion is pretty much run by the scuzzy rich dudes one would expect:

Lion Capital may not be an entirely grey-suited, sober company of British investors. Just last week, Lyndon Lea, the son of a Lancashire hairdresser and a founding partner of the private equity firm, was reported to have held a no-expense-spared polo party at his £25m mansion in Montecito, California, with sushi being served off scantily clad women rather than plates.

The Rise And Fall Of American Apparel [Guardian]

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