Revlon Files for Chapter 11 Bankruptcy Protection

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Cosmetics giant Revlon filed for Chapter 11 bankruptcy on Wednesday night as it struggled with heavy debt and a congested supply chain.

The company said it expects to receive $575 million in debtor-in-possession financing from its existing lender base, which will help support its day-to-day operations.

“Today’s filing will allow Revlon to provide our consumers with the iconic products we have offered for decades, while also clearing a clearer path for our future growth,” said Revlon President and CEO, Debra Perelman, in a press release issued Thursday morning.

“Our challenging capital structure has limited our ability to manage macro issues to meet this demand,” Perelman added.

The nail polish and lipstick maker, which is controlled by billionaire Ron Perelman’s MacAndrews & Forbes, has listed assets and liabilities between $1 billion and $10 billion, according to a filing in the US bankruptcy court. Southern District of New York.

Revlon had long-term debt of $3.31 billion as of March 31, according to a securities filing. The company’s market capitalization was nearly $123 million at the close of trading on Wednesday. Trading in Revlon shares was halted during Thursday’s premarket session.

In late 2020, as stuck-at-home consumers drastically cut spending on beauty items, Revlon narrowly avoided bankruptcy when enough bondholders participated in its debt restructuring program. The company had warned in early November of that year that it might be forced to seek Chapter 11 protection.

Its sales of about $1.9 billion in 2020 were down 21% from 2019 levels. Although business rebounded in 2021, Revlon’s revenue is still below pre-pandemic levels.

Perelman’s MacAndrews & Forbes acquired Revlon in a hostile takeover for about $1.8 billion in 1985. It went public 11 years later.

The business has grown over the years through acquisitions, including the Cutex business of Coty and Elizabeth Arden. In addition to her eponymous makeup banner, her portfolio also includes Almay, American Crew and Britney Spears Fragrances.

PJT Partners is acting as financial advisor to Revlon, and Alvarez & Marsal is acting as restructuring advisor.

This story is developing. Please check for updates.

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