Tag Archives: lingerie china

SEX, LIES AND UNDERWEAR IN DEAL

If the potential acquisition of American lingerie china Apparel Inc. for roughly $360 million, by Endeavor Acquisition Corp. were a movie, it would be billed as “Wall Street” meets “Boogie Nights.” American Apparel is run by Dov Charney, the underwear-baring, foulmouthed founder who more closely resembles a 1970s porn star than a top executive of a company that sells pricey Tshirts and leggings to twenty something waifs.

Charney’s  freewheeling ways have made him the target of multiple lawsuits filed by employees who allege he uses indecent language and has a penchant for showing his underwear.

One plaintiff went so far as to accuse Charney of giving her a vibrator, according to published reports. Charney has denied all the allegations.

Endeavor Acquisition’s two chiefs, Jon Ledecky and Eric Watson, are known to have less than pristine reputations as well.

Watson settled with the Securities and Exchange Commission in 2001 over insider-trading allegations related to an acquisition made by U.S. Office Products.

At the time, Watson was the chief executive of a U.S. Office subsidiary, Blue Star Group.

(For those not up on their “Wall Street” trivia, Bluestar was the name of the company that Michael Douglas’ character, Gordon Gekko, profited from by trading on insider information supplied to him by Bud Fox.) Watson also suffered two adverse court judgements in suits brought by former employees and business partners in his native New Zealand.

Ledecky, meanwhile, spent the 1990s socking away nearly $60 million as chairman of several companies, including Floral Products and Building One. Several of those firms eventually went bankrupt under heavy debt loads, evaporating millions in investor cash.

After telling the Washington Post that he had gone through a selftransformation – which included giving $10 million to charity, taking up Bible study and trying to make peace with some of the people he misled – Ledecky was back on the scene with Endeavor, which raised $120 million through an initial public offering on the American Stock Exchange last year.

A so-called special purpose acquisition company, or SPAC, Endeavor’s sole purpose is to seek out private companies to buy, thereby allowing them to trade publicly without the scrutiny that usually accompanies an initial public offering.