(Adds details on poison pill plan)
July 1 Dov Charney, ousted as American Apparel
Inc's chairman and chief executive two weeks ago, said
he has increased his stake in the apparel retailer to 43
percent, as he fights to regain control of the company he
Charney, fired for alleged misuse of corporate funds and his
role in disseminating nude photos of an ex-employee, also called
for a special meeting of stockholders on Sept. 25. (1.usa.gov/VBYyX3)
The former CEO and founder, already the biggest shareholder
in American Apparel with a previously reported 27.2 percent
stake, said he increased his holding last week. The additional
shares could enable Charney to gain control of the company if he
won the support of shareholders holding 7 percent of the stock.
After Charney's statement, American Apparel shares dropped
3.3 percent to 87 cents. The stock closed at 69 cents on June
19, the day Charney was ousted.
Charney said last month he wanted to shake up American
Apparel's management and board. The company said it did not wish
to engage in discussions with Charney.
The 45-year-old said on Tuesday he would seek to fix the
number of directors on the board at 15, adding members
identified by him.
Charney's lawyer had threatened legal action in a letter
sent to American Apparel should he not regain his executive
Montreal-born Charney said he owned 74.56 million shares in
American Apparel as of last Friday, including 27.35 million
acquired for him by hedge fund investor Standard General in a
loan arrangement. (bit.ly/1sTXgVT)
American Apparel last Saturday adopted a one-year poison
pill after Charney said he would fight to regain influence over
The poison pill was put in place by a special committee of
the board, which said it would limit the ability of any
shareholder "to seize control of the company without
appropriately compensating all American Apparel stockholders."
The plan, designed to flood the market with inexpensive
shares to impede a takeover, would go into effect if any
shareholder accumulates 15 percent or more of the stock. If a
shareholder already owns 15 percent or more of the retailer's
stock, as Charney does, it would go into effect if that
shareholder acquired 1 percent more.
American Apparel and Charney were not immediately available
for a comment.
(Reporting by Shailaja Sharma in Bangalore; Editing by Joyjeet
Das and Andrew Hay)