By Dietrich Knauth
(Reuters) – A U.S. judge on Monday approved Revlon Inc’s reorganization plan, allowing the cosmetics giant to cut $2.7 billion from its debt and exit bankruptcy later this month.
U.S. Bankruptcy Judge David Jones in Manhattan, who has been overseeing the company’s Chapter 11 bankruptcy, said Revlon had reached “a hard-fought multi-faceted settlement” that resolves a “series of enterprise-threatening” risks to the business, including “debilitating” litigation among its lenders.
Under the plan, Revlon’s lenders will take ownership of the company in exchange for the debt reduction agreement, wiping out the equity value of existing shareholders. The reorganized company plans to raise $670 million after exiting from bankruptcy by selling new equity shares.
Revlon, which has a 91-year history selling lipstick, nail polish and other beauty products, filed for bankruptcy in June, saying its $3.5 billion debt load and pandemic-related disruptions had left it too cash-poor to make timely payments to critical vendors in its cosmetics supply chain.
(Reporting by Dietrich Knauth; Editing by Mark Porter)
