Revlon, a 90-year-old international cosmetics company, filed for bankruptcy in the United States, citing high inflation and global supply chain crisis as reasons.
The company filed for Chapter 11 bankruptcy protection late Wednesday, June 15, 2022, to handle its debt, which is estimated to be "worth between USD1 billion and USD10 billion."
According to uscourts.gov, a case filed under chapter 11 of the United States Bankruptcy Code is also referred to as a "reorganization bankruptcy" where "the debtor remains 'in possession,' has the powers and duties of a trustee, may continue to operate its business, and may, with court approval, borrow new money."
Reuters reported on Thursday, June 16, that Revlon's long-term debt as of March amounted to USD3.31 billion.
If its bankruptcy case is approved in court, the cosmetics firm is expecting to receive USD575 million in financing from its existing lenders to support day-to-day operations.
In a press release published on the company's website on Thursday, June 16,
"Consumer demand for our products remains strong—people love our brands, and we continue to have a healthy market position.
"But our challenging capital structure has limited our ability to navigate macro-economic issues in order to meet this demand.
"By addressing these complex legacy debt constraints, we expect to be able to simplify our capital structure and significantly reduce our debt, enabling us to unlock the full potential of our globally recognized brands.
"We are committed to ensuring the reorganization is as seamless as possible for our key stakeholders, including our employees, customers and vendors, and we appreciate their support during this process."
The press release also noted that "none of Revlon’s international operating subsidiaries are included in Wednesday's U.S. Chapter 11 proceedings, except
At press time, Le Becarre International Corporation, Revlon’s authorized distributor in the Philippines, is yet to issue an official statement.
But some of its employees and brand ambassadors have already taken to social media to assure their customers that Revlon Philippines is "not affected" and remains "fully operational."
Revlon was founded in 1932 by brothers Charles and Joseph Revson and Charles Lachman. It reached international status in the mid-1950s.
In 1985, the brand was bought by MacAndrews & Forbes, the company owned by Debra's father, billionaire businessman Ronald Perelman.
Revlon is presently available in more than 150 countries.
Aside from the Revlon brand, the company also owns other well-known beauty brands, such as Elizabeth Arden, Cutex, Almay, and perfume lines of Christina Aguilera and Britney Spears.
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