Watson out of American Apparel

Eric Watson. Photo / Kenny Rodger

A spokeswoman for Eric Watson said yesterday the entity associated with him had sold out of American Apparel, the Los Angeles-based leisure wear company facing doubts about its future.

Endeavour Acquisition Corp - a company formed by Jonathan Ledecky and Eric Watson - acquired a stake in American Apparel in a deal announced in 2006.

American Apparel, known for its edgy advertising and controversial chief executive, warned this week that there was "substantial" doubt about its ability to continue as a going concern and said it could breach a loan covenant.