The former boss of American Apparel is planning to launch a rival fashion proposition that will have a store and online presence.

Dov Charney, who left the fashion retailer under controversial circumstances in 2014, has teamed up with investment firm Hagan Capital to work on the new venture.  

This will be Charney’s first foray back into retail since being suspended from American Apparel over allegations of misconduct.

Last month American Apparel rejected a $320m (£224m) bid from a group of investors, which included Hagan Capital, backing the return of Charney.

Speaking to fashion trade title WWD, the investment firm’s chief executive Chad Hagan said: “What’s important to us now is we’re able to form this new venture and put Dov at the helm.”

According to Hagan, the rival fashion retailer will have a similar proposition to American Apparel as a “basics brand for men and women that will be manufactured entirely in the US and will begin with a focus on developing the wholesale channel”.

He added: “We’re going to do what Dov does best and then establish a robust ecommerce system, but we will not be debuting just as an online retailer.”