Being unable to manage its heavy debt load after failing to tap into a cosmetics sales boom driven by social-media influencers, Revlon, the cosmetic giant, has filed for Chapter 11 bankruptcy.
Revlon is owned by billionaire Ron Perelman, sought court protection in the Southern District of New York after the global supply chain crunch and steep inflation deepened its woes.
The brand was not able to keep pace with rival giants like L’Oreal and Estee Lauder as well as upstart makeup and personal-care brands that have turned to video bloggers and Instagram personalities to fuel growth.
Revlon listed assets totaling US$2.3 billion as of late April in its court filings. This amount stands in contrast to total debts of US$3.7 billion, which include its 6.25 percent senior notes due in 2024, according to court papers dated June 15.
Chapter 11 filings allow a company to continue operating while it works out a plan to repay creditors. The bankruptcy caps a tumultuous period for the 90-year-old company, which suffered during the pandemic and faced years of declining sales as consumer tastes changed and upstart brands ate into its market share.
On top of the dollar bond, the company has 10 outstanding loans with amount totalled $2.6 billion and maturing in the next three years.
