Billionaire Ron Burkle reduces American Apparel shares

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Less than a year after buying up 6% of American Apparel‘s stock, Los Angeles billionaire Ron Burkle has cut his stake in the struggling clothing company.

According to a regulatory filing Tuesday, Burkle sold about 1 million shares in recent weeks, reducing his stake in the company to 3.4 million shares, or about 4.3% of common stock, as of Jan. 20. Burkle, who made his fortune in the supermarket business, sold his shares at prices ranging from $1.40 to $1.65.

Last June, in a filing that showed he had purchased 4.3 million shares for $5.9 million, Burkle said he acquired American Apparel’s stock ‘because, in his opinion, such shares were undervalued.’

After a difficult couple of years, American Apparel -- the downtown L.A. clothing maker of colorful clothing loved by hipsters -- has been in the process of turning itself around. Chief Executive Dov Charney remains the company’s largest shareholder.

Shares of American Apparel rose 16 cents, or 16%, to $1.16 during regular trading Tuesday. The stock had plunged 22% on Monday in heavy trading, extending a sell-off that began earlier this month. The shares ended last year at $1.66.

-- Andrea Chang