Revlon inventory jumps on report it’s contemplating a sale
A deal has not been reached, however Revlon is exploring all its choices, an individual accustomed to the matter instructed Bloomberg.
Earlier this month, the corporate acquired a $200 million four-year senior secured mortgage to assist fund its enterprise.
The enterprise has been struggling, and the money was wanted to assist Revlon innovate and put together for refinancing different debt it has excellent. The corporate, which is majority-owned by Ronald Perelman’s MacAndrews & Forbes, has greater than $three billion of debt on its stability sheet.
Final week, it reported its second-quarter internet loss narrowed to $63.7 million from $122.5 million a yr earlier. However internet gross sales fell 6% to $570.2 million, harm by gross sales declines at its smaller manufacturers.
The corporate’s liquidity improved to $260 million, as of final week, from $108 million on the finish of the second quarter.
In a Might 10-Q submitting, Revlon mentioned it had prolonged the maturity of a $41.5 million mortgage from April 2019 by a yr, and the corporate additionally disclosed liquidity dropped under a required threshold by one among its loans.
Even when Revlon is open to being acquired, it’s unsure whether or not there’s a firm that will have an interest. Others in mass marketplace for coloration cosmetics have additionally had challenges, as customers more and more flip to retailers corresponding to Sephora and Ulta Magnificence, or on-line startups corresponding to Glossier, for his or her merchandise.
Cosmetics distributor Coty acquired Covergirl for $12 billion from Proctor & Gamble in 2015 however mentioned earlier this yr that it could write down round $three billion in property from P&G. In July, L’Oreal reported a slowdown in North American gross sales, recording a 1.1% decline.
Revlon’s inventory has fallen 37% since January and has a market cap of $825 million.
Revlon was not instantly out there for remark.