An Iconic Makeup Brand Is Looking For Buyers To Save It From Collapse
Makeup giant Revlon is facing bankruptcy and creditors for the company are at odds on how to proceed
The long-time makeup brand, Revlon, is currently going through bankruptcy court and working to restructure its current bankruptcy plan. The company has reestablished vendor relationships and put together a new business plan for the long term. Revlon also has a list of bidders with whom they are working to possibly sell the company.
The long-time cosmetic company, Revlon, was supposed to reach an agreement for the restructuring of the company by mid-November but the company is currently seeking more time. Revlon has begun to send out letters for nondisclosure to parties interested in purchasing the company. An extension beyond mid-November would allow potential bidders ample time to review the business plan, restructure the plan and the goals the company has set.
The company is facing many obstacles but is working hard to fight the battle at hand. Revlon is working to remove control from senior lenders’ influence over the company because of certain things they have allowed in the past. The current senior lenders allowed the company to take on a significant amount of debt while transferring assets and brands of the company, which is not ideal.
Junior creditors of Revlon are also pushing back in the courts against a push for a 2022 holiday sale. The push for a holiday sale is again coming from senior lenders who are also imposing deadlines and sales numbers for the company that are just unrealistic at this time. The junior creditors are arguing that this holiday push would only benefit the senior lenders and is not good for the company as a whole as they should be focusing on the company restructuring and bankruptcy plan.
Chapter 11 bankruptcy is a type of bankruptcy that allows for the reorganization of a company. Companies who file this type of bankruptcy have a plan to continue and revive business and a plan to pay the debt over a period of time. Chapter 11 bankruptcy also provides relief to companies like Revlon in the form of the ability to untangle contracts, debt relief, and general breathing room to allow for further plans to be made and set into motion.
Revlon first made a name for itself in 1932 selling nail polish and began selling lipstick seven years later in 1939. The company was founded by brothers Joseph Revson and Charles Lachman in New York. During the height of Revlon, it was second in sales only to Avon and it is currently number 22 on the current list of cosmetic brands.
Revlon has a great history of success and has been a leader in the cosmetics and beauty industry from the start. Despite the fact of great success and revolutionary products, the company is currently facing some serious financial troubles. Revlon filed for voluntary chapter 11 bankruptcy in June of 2022.
Revlon is in a huge predicament and the company wants to get out of bankruptcy as quickly as possible to avoid paying any additional interest and fees that they are currently incurring. Having a solid plan and undergoing a full business restructure takes time and strategic movement. The company has until January to formalize and present its bankruptcy plan.
