Must-Read Money Stories for Wednesday, Jan. 11

by January 11, 2017
Bankrupt clothing retailer American Apparel recently auctioned some of its assets for $88 million, but its stores and brand remain in limbo. (Image "American Apparel" by William Murphy via Flickr, CC license by 2.0.)

Bankrupt clothing retailer American Apparel recently auctioned some of its assets for $88 million, but its stores and brand remain in limbo. (Image “American Apparel” by William Murphy via Flickr, CC license by 2.0.)

Mayer out, new name for Yahoo

Following the anticipated $4.8 billion-sale of its core internet business to Verizon Communications Inc., Yahoo Inc. will change its name to Altaba Inc. while CEO Marissa Mayer and co-founder David Filo will step down from the board of directors, the company disclosed in regulatory filings this week. Altaba—a holding company with primary assets held in Alibaba Group Holding Ltd. and Yahoo Japan—is a combination of the words “Alibaba” and “alternate,” unnamed sources told The Wall Street Journal. The expected changes, however, are less than certain, given two recent large-scale data breaches of Yahoo’s user data. Those events may give Verizon leverage to change terms of the deal or back out entirely.

American Apparel in limbo

Liquidation may be in the foreseeable future for American Apparel, which recently auctioned its intellectual property and other assets to Gilden Activewear Inc. The $88 million deal was part of its second bankruptcy in roughly a year, Bloomberg reported Tuesday. What that means for the retailer’s 100-plus stores, which weren’t included in the transaction with Gilden, its 4,700 employees or the American Apparel brand is unclear. Some of the most profitable locations could be purchased and continue operating under the American Apparel name. But since Gilden chose not to exercise its right to renew leases at the retailer’s two factories and distribution center in Los Angeles, it’s unclear where American Apparel products will be made moving forward.

Valeant eases debt with L’Oreal deal

In a move aimed at easing a $30 billion-debt load, Canadian pharmaceutical giant Valeant announced plans to unload a batch of its skincare products and its cancer-treatment business. The separate deals were made with French cosmetics company L’Oreal and China-based Sanpower Group, respectively, according to Bloomberg. Investors and analysts say the two deals, worth a combined $2.1 billion, are a solid step forward for Valeant, which saw its stock prices soar following Tuesday’s announcement. It’s some reprieve from the price and accounting scandals and subsequent government investigations that have surrounded Valeant in recent months.

New pay structure for Wells Fargo employees

Wells Fargo & Co.’s clean-up efforts from a bruising scandal that began unfolding in September continued Tuesday, when the banking giant rolled out its plan on how it will pay bank tellers and other branch employees, according to the Los Angeles Times. The plan has been one of the most anticipated changes thus far at Wells Fargo because it eliminates the aggressive sales goals that led employees to open up to 2 million customer accounts without authorization. Moving forward, employees will be incentivized by how often customers use their accounts, rather than how many are opened.