American Apparel has filed for bankruptcy protection in the United States.

The troubled retailer - which has 260 shops across 19 countries - has confirmed it will be restructuring its finances in a bid to turn around its fortunes after recording heavy losses of £12.8m in the second quarter.

In a statement, chief executive Paula Schneider said: ''This restructuring will enable American Apparel to become a stronger, more vibrant company.''

The company have maintained that the financial restructuring will not see any of their stores closing worldwide.

Meanwhile, Paula - who took over as CEO in January - previously admitted the company's debt wasn't ''sustainable''.

She explained: ''Our debt load simply wasn't sustainable. You can't do a turnaround plan without cash ... And it was all to get to the point where we could make these massive interest payments, and nothing that was really moving the company forward.

''Not having the nuisance lawsuits, not having this massive debt, these are all extremely important things for the company to thrive.''

The company have also been locked in a bitter legal battle with the clothing retailer's founder Dov Charney, after he was booted from his job last year.