Canadian apparel maker Gildan Activewear Inc said it had won a bankruptcy auction to buy U.S. fashion retailer American Apparel for about $88 million in cash.
The deal is subject to approval from a bankruptcy court on Thursday, the company said.
Under the deal, Gildan will acquire the intellectual property rights related to the American Apparel brand and certain manufacturing equipment. The company, however, will not buy any of the 110 American Apparel retail stores.
Reuters reported late on Monday that Gildan had won the auction, which also attracted other bidders such as California-based apparel maker Next Level.
Guggenheim Securities, LLC is acting as Gildan's financial adviser, while Sullivan and Cromwell LLP are providing legal advice.