Cosmetics maker Revlon to file for bankruptcy protection
16 Jun 2022
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Debt-laden US cosmetics company Revlon will be filing for chapter 11 protection by next week, the Wall Street Journal reported on Friday, citing people familiar with the matter.
Revlon, which is owned by billionaire Ron Perelman’s MacAndrews and Forbes, is in talks with lenders ahead of looming debt maturities to try to steer the business clear of bankruptcy, according to the WSJ report.
Revlon had long-term debt of $3.31 billion, as of end-March.
While demand for cosmetic products has bounced back in recent months as economies emerge from the prolonged effects of the Covid-19 pandemic, Revlon, is facing stiff competition from native brands and online marketing start-ups while also facing supply chain problems.
New York-based Revlon has been struggling amid competition from Estee Lauder Cos and a host of smaller companies using social media to lure customers.
Reports citing sources close to the negotiations said talks around the potential filing for bankruptcy protection are continuing and could change.
Reorg Research first reported on the potential bankruptcy. Revlon’s shares plunged 53 per cent on Friday, the biggest one-day drop, to close at $2.05.
The company has narrowly averted multiple defaults by cutting debt deals with creditors so far. Talks with creditors may also lead to changes in the equity ownership of the company, according to one of the sources.
Revlon has more than 15 brands, including Elizabeth Arden and Elizabeth Taylor, which it markets in nearly 150 countries.
