The same hedge fund that forced the sale and breakup of Hostess Brands Inc. now aims to work the same trick on American Apparel Inc. (NYSE: APP). Monarch Alternative Capital is American Apparel’s leading bondholder and has been pushing for a sale of the company’s U.S. manufacturing plants and shipping the jobs overseas. Monarch also wants the company sold.

Monarch may get what it wants, but it won’t happen soon. Last Friday, founder and ousted CEO of American Apparel, Dov Charney, borrowed enough shares in the company’s common stock to raise his stake from 27% to 43%. The lender of those shares was hedge fund Standard General, and late Wednesday Charney handed over the entire 43% of American Apparel stock to Standard General.

When Charney first borrowed the stock from Standard General, American Apparel had not adopted its poison pill. Because Charney’s goal of gaining a majority of shares and thus regaining his seat at the top of the firm was no longer achievable as a result of the poison pill, Charney has now lent his entire stake in American Apparel to Standard General, according to an exclusive report from Reuters.

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Standard General provided the capital American Apparel needed in March to make its scheduled interest payment to Monarch. And Charney’s ouster has led another bondholder, Lion Capital, to demand repayment by July 4 of a $10 million loan as a result of the change of control.

The company’s board has refused to negotiate with Charney but has agreed to talks with Standard General related to American Apparel’s governance structure and its financial position. The Wall Street Journal has reported that Standard General has made it clear to Charney that it is not guaranteeing him a role in the future of the company. In a letter to its shareholders, Standard General said:

The founder has agreed that he will not serve on the board nor play any leadership role in the company until the process is complete, and he will serve no role if he is deemed unfit.

Standard General will nominate a slate of directors for American Apparel and expects shareholders to approve its nominations. The new board will be charged with hiring a new management team and turning the company around. Whether Charney gets his old job back at that point remains questionable.

American Apparel shares were up more than 18% in premarket trading Thursday to $0.97, after closing at $0.83 on Wednesday. The stock’s 52-week range is $0.46 to $2.09.

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