American Apparel Inc., the sometimes-controversial Los Angeles clothing manufacturer and retailer, is expanding in spite of its unsettled financial situation.

The company has acquired the assets of U.S. Dyeing & Finishing Inc. for $3.8 million. As a result of the purchase, American Apparel will gain a manufacturing facility in Garden Grove, two adjacent buildings and about 140 employees.

"The purchase of U.S. Dyeing & Finishing is an important addition to American Apparel's production capacity," said Marty Bailey, American Apparel's chief manufacturing officer, in a statement. "While American Apparel already operates one of the largest cut-and-sew operations of its kind, this acquisition will further reduce our reliance on contract dye facilities, allowing us to expand our product offering, streamline our supply chain, lower costs and ensure better quality control."

The company has maintained the bulk of its manufacturing operations in the Los Angeles area a fact the company has used to promote itself.

The acquisition comes as the company last week reported first quarter profit of $1.1 million, or two cents per share a 34 percent drop from the same period last year. Revenue, meanwhile, rose 52 percent to $112 million. News of the earnings sent its shares down nearly 20 percent to $6.87 before rebounding later in the day to almost $8.

The company known as much for its sexualized ad campaigns and flamboyant founder as for its colorful clothing is in the middle of an ambitious growth initiative. The company has expanded its retail presence to nearly 200 stores in 15 countries from just a handful of locations five years ago.

Pushing Ahead

Despite ongoing battles in Congress and the court of public opinion, Northrop Grumman Corp. last week announced plans to open a manufacturing facility for the KC-45 aerial refueling tanker.

Northrop is pushing ahead with its plans to open a manufacturing facility on June 28 in Mobile, Ala., where workers will complete the plane's final assembly.

The Los Angeles-based defense contractor has been the target of widespread ill will since the Air Force earlier this year awarded a $35-billion tanker contract to Northrop and its European partner. Boeing Co., which submitted a rival bid for the massive contract and was widely considered the favorite in the competition, has protested the award and the government is expected to announce whether to overturn the contract in the coming weeks.

Northrop also held a rally for workers recently at its El Segundo factory to celebrate the contract win and encourage the employees to write to Congress and urge them not to overturn the deal.

Northrop has identified 42 California companies that will supply parts to the new plane, supporting 7,500 mostly local jobs.

Suit Tossed

Alltrade Tools LLC, a Long Beach-based manufacturer of tools and shop equipment, got a big victory in court recently when a judge tossed out a lawsuit that could have cost the company millions of dollars.

United States District Court Judge Otis Wright dismissed a trade dress infringement suit brought by Ontario-based Larin Corp. related to saddle stools with seats designed like motorcycle seats. Larin claimed Alltrade had violated intellectual property rights laws by infringing on the company's design, and that Alltrade had engaged in false advertising.

"Alltrade has a strict policy of taking all reasonable steps to ensure that it does not infringe upon anyone else's intellectual property rights," said Seong Kim, a Century City-based lawyer who represented Alltrade, in a statement.

Raising Funds

A local manufacturer of power management systems for alternative fuel vehicles now has quite a bit more cash available.

Torrance-based Enova Systems Inc. has raised more than $13 million in financing deals through both the American Stock Exchange and London's Alternative Investment Market. The deals are substantial for a company that recorded just $9 million in sales last year.

The company recently sold more than one million shares of its common stock to institutional investors for a total of $5 million.

The agreement comes after the company last month completed a similar deal in the United Kingdom in which it sold 2.1 million shares for about $8.3 million.

The company also announced late last month that its chairman, Anthony Rawlinson, has resigned after nine years with the company.

Enova specializes in intricate drive systems for electric, hybrid and fuel cell vehicles.

Staff reporter Richard Clough can be reached at rclough@labusinessjournal.com or at (323) 549-5225, ext. 251.

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