When Revlon filed for Chapter 11 bankruptcy protection in the US last June, the news sent shock waves through the global beauty industry. The 91-year old multinational was struggling with over US$3 billion in debt and major supply chain issues.
Fortunately, Revlon’s ANZ business continued to perform strongly and not only claims the #2 brand position across the total cosmetics market. The Aussie arm also holds the #1 position in the lip, foundation and eyeshadow categories.
In New Zealand, Revlon also holds the dominant position of being the #1 colour cosmetics brand ahead of Maybelline New York and L’Oréal Paris.
Now there’s good news from the parent company in the US. The acknowledged colour authority is set to exit bankruptcy by April 17th following legal approval of the company’s forward-looking restructuring plans.
The company will become private and longtime owner Ron Perelman will no longer be at the helm. The billionaire businessman first acquired a major stake in Revlon in 1987 and the company thrived for decades.
Up until the beginning of this year, Perelman owned 85 per cent of the company. His daughter, Debra, however, remains chief executive officer of Revlon.
In addition to the core brand, Revlon’s stable includes Elizabeth Arden, Almay, American Crew and designer fragrance brands such as Juicy Couture, Britney Spears, Curve, John Varvatos and Christina Aguilera.
Under the approved plan, Revlon will eliminate US$2.7 billion in debt with US$1.5 billion still outstanding. The majority of the company’s equity will be given to the lenders of a 2020 loan, officially known as the BrandCo lenders.
In addition, the company will also have US$285 million in liquidity to be funded through an equity rights offering, new asset-based loans and a new money senior secured credit facility.
The plan confirmation is a critical milestone, notes CEO Debra Perelman. “We know the financial restructuring has been challenging for our employees, vendors and partners, and we thank them all for their support. Our new capital structure and increased liquidiy will enable us to continue to animate our brands in the market, and we look forward to the future of Revlon”.
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