Revlon has voluntarily filed for Chapter 11 bankruptcy protection in the Southern District of New York.
The cosmetics company expects to receive $575 million in debtor-in-possession financing after court approval, according to a statement published Thursday in the investors section of its website. The hope is that the move will allow Revlon to “strategically reorganize” to improve the company’s long-term prospects, the statement noted.
Assets and liabilities of between $1 billion and $10 billion were listed in a court filing on Wednesday, according at Reuters. (RELATED: ‘Put On Your Seatbelts’: BlackRock Chairman Warns ‘Entitled Generation’ Of Inflation-Driven Shortages)
Cosmetics giant Revlon has filed for Chapter 11 bankruptcy.
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Revlon cited supply chain disruptions and rising inflation, as well as “global challenges” and “obligations to its lenders,” as sources of the company’s current liquidity constraints.
“Today’s filing will allow Revlon to bring our consumers the iconic products we’ve offered for decades, while providing a clearer path for our future growth,” said the president and CEO of Revlon. Revlon, Debra Perelman, in the release.
“Consumer demand for our products remains strong – people love our brands and we continue to have a healthy position in the market. But our difficult capital structure has limited our ability to manage macro-economic issues in order to meet this demand,” she continued. “By addressing these complex legacy debt constraints, we hope to be able to simplify our capital structure and significantly reduce our debt, allowing us to unlock the full potential of our brands. recognized companies. We are committed to ensuring that the reorganization is as seamless as possible for our key stakeholders, including our employees, customers and suppliers, and we appreciate their support throughout this process.”
The bankruptcy filing impacts Revlon’s Canadian and UK subsidiaries, but none of their other international operating subsidiaries do, according to the statement.
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Brothers Charles and Joseph Revson and Charles Lachman founded Revlon in 1932, and the company went public in 1996, according at CNN. Just eight years ago, in 2016, the company acquired Elizabeth Arden for $870 million, the outlet continued.
Sales have lagged in recent years, largely due to increased competition from startups and issues related to the COVID-19 pandemic, CNN reported. In 2021, sales had fallen 22% from 2017 levels, and shares have fallen more than 80% since the start of 2022, according to the outlet.