New York: US cosmetics and skincare company Revlon is likely to file for bankruptcy, according to media reports.
The company is likely to file for Chapter 11 protection, filing for bankruptcy under US law, as early as next week due to huge debt, fierce competition in the cosmetics industry, inflation and supply chain pressures, the Wall Street Journal reported. citing people familiar with the matter.
Revlon is owned by billionaire Ron Perelman. MacAndrews & Forbes has already started talks with lenders ahead of next year’s debt maturity.
The bankruptcy filing will end Perelman’s control of the company, which his private equity firm purchased in 1985.
Glendon Capital Management LP and King Street Capital Management are restructuring talks with Revlon to clear $1.7 billion in debt, the WSJ reported last week.
Revlon faced fierce competition from emerging digital-native brands and was unable to overcome supply chain constraints that hampered its ability to meet demand.
According to the Reuters news agency, Revlon had long-term debt of $3.31 billion in March.
Meanwhile, according to the news agency, Revlon shares plunged 46% after news broke of the cosmetics giant preparing to file for bankruptcy.