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The Wall Street Journal, and is subject to court approval. The move comes two weeks after rival Los Angeles-based teen clothing retailer American Apparel LLC (AA), one of the largest apparel manufacturers in North America, reportedly hired investment bank Houlihan Lockey to explore a sale of the company, which was founded in 1989 by its controversial former chairman and CEO Dov Charney. In February 2016, American Apparel itself exited bankruptcy and is now privately owned by its creditors under a financial restructuring plan whereby the company converted $230 million in a debt-for-equity swap. AA’s new owners include Standard General, Monarch Alternative Capital, Coliseum Capital, and Goldman Sachs Asset Management. Two years ago, Aéro tied the knot for a $150 million senior secured credit facility with New York private equity firm Sycamore Partners, in conjunction with a sourcing arrangement with Sycamore’s portfolio company MGF Sourcing. However, the deal with Sycamore came back to haunt Aéro. On May 4, 2016, Aéropostale took the next steps in its ongoing business transformation saga by filing voluntary Chapter 11 bankruptcy petitions, closing 113 U.S. locations and all of its 41 stores in Canada. Aéropostale, headquartered in New York City, has about 800 stores in the U.S. and Puerto Rico, and through licensing arrangements around the world, but its footprint is expected to still be reduced drastically. The first Aéropostale store was opened in 1987 by Macy’s in the Westside Pavilion Mall in Los Angeles. The store was the brainchild of R.H. Macy Co. Aéro posted 13 straight quarterly losses and reported a net loss for fiscal 2015 of $136.9 million, which are provoking severe liquidity constraints. The company also indicated that it failed to resolve a vendor dispute with MGF, which “is causing a disruption in the supply of some merchandise.” “Under normal conditions, we would be very optimistic about our potential for financial growth throughout the first half of 2016,” said Aéropostale’s CEO Julian Geiger earlier this year. “Regrettably, our short-term visibility is limited by our current vendor dispute.” Sycamore, with more than $3.5 billion in capital under management, specializes in retail and consumer investments. The firm’s portfolio includes Talbots, Stuart Weitzman, Nine West, Kurt Geiger, Coldwater Creek, Belk, Dollar Express, Hot Topic, and others. Sycamore was founded in 2011 by Stefan Kaluzny and Peter Morrow, who previously worked at San Francisco private equity firm Golden Gate Capital. Given Sycamore’s aggressive retail shopping spree, The New York Times once referred to the pair as, “no retail parvenus.” Although Aéropostale continues to struggle with falling sales, its rivals such as American Eagle Outfitters Inc (NYSE: AEO) and Abercrombie & Fitch Co (NYSE: ANF) have managed to turn around their businesses by controlling inventories and responding faster to changing fashion trends.]]>