Rumor: Dov Charney Wants To Buy American Apparel

American Apparel Inc's (NYSE: APP) controversial co-founder Dov Charney is part of a group that recently bid between $1.30 and $1.40 per share to acquire the company, according to a rumor published by the New York Post.

The company's shares gained 58 percent on the rumor, but fell $0.03 (2.5 percent) in after-hours action recently to $0.98.

Citing unnamed sources, the newspaper said the apparel company has recently received multiple takeover bids, including one for between $1.30 to $1.40 a share from a private equity firm affiliated with Charney.

Charney, formally terminated by the company Tuesday, had served as a consultant to American Apparel following his suspension in June as chief executive for alleged misconduct and violations of company policy.

Charney said in a statement Thursday posted on Yahoo that American Apparel recently offered him "a multi-million dollar compensation package" which he refused to accept.

But the company's board said Tuesday that in light of its recent investigation, it had "determined that it would not be appropriate" for Charney to be reinstated as CEO or an officer or employee.