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Cosmetics giant Revlon filed for Chapter 11 bankruptcy protection on Wednesday evening as it grappled with a cumbersome debt load and a snarled supply chain.
The company said it expects to receive $575 million in debtor-in-possession financing from its existing lender base, which will help to support its day-to-day operations.
“Today’s filing will allow Revlon to offer our consumers the iconic products we have delivered for decades, while providing a clearer path for our future growth,” Revlon President and Chief Executive Officer Debra Perelman said in a press release issued Thursday morning.
“Our challenging capital structure has limited our ability to navigate macro-economic issues in order to meet this demand,” Perelman added.
The nail polish and lipstick maker, which is controlled by billionaire Ron Perelman’s MacAndrews & Forbes, listed assets and liabilities between $1 billion and $10 billion, according to a filing with the U.S. Bankruptcy Court for the Southern District of New York.
Revlon had long-term debt of $3.31 billion as of March 31, a securities filing shows. The company’s market cap was nearly $123 million as of the close of trading Wednesday. Trading in Revlon shares was halted in Thursday’s premarket session.
In late 2020, as stuck-at-home consumers dramatically curtailed their spending on beauty items, Revlon narrowly avoided bankruptcy when enough bondholders took part in its debt restructuring program. The company had warned in early November of that year that it may be forced to file for Chapter 11 protection.
Its sales of about $1.9 billion in 2020 were down 21% from 2019 levels. Though the 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 grew over the years through acquisitions, including of Coty‘s Cutex business and Elizabeth Arden. In addition to its namesake makeup banner, its 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 back for updates.