Revlon, a cosmetics giant with a 91-year history, filed for Chapter 11 bankruptcy in June 2022 due to its $3.5 billion debt load and pandemic-related disruptions. The company struggled to make timely payments to critical vendors in its cosmetics supply chain. However, a U.S.
judge approved Revlon's reorganization plan on April 3, 2023, allowing the company to cut $2.7 billion from its debt and exit bankruptcy later that month. During its bankruptcy, Revlon reached settlements with two factions of lenders who
financed the company's purchase of cosmetics and fragrance company Elizabeth Arden in 2016. Under the reorganization plan, Revlon's lenders will take ownership of the company in exchange for the debt reduction agreement, wiping out the equity value of existing shareholders.
The reorganized company plans to raise $670 million after exiting from bankruptcy by selling new equity shares. View this post on Instagram A post shared by Revlon (@revlon) Revlon faced numerous challenges in 2022, including lagging sales, accounting errors, and its bankruptcy filing.
However, a surprise turn came in December when the embattled beauty brand was fully acquired by its lenders. The company is set to emerge from bankruptcy as a private company, now that a federal judge has approved its plan.
The nail polish and lipstick maker experienced a decline in sales during the pandemic, with revenues dropping 21% from 2019 levels. Despite a rebound in 2021, Revlon's revenue remained below pre-pandemic levels…
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