Beauty Products King Revlon Lenders Take Control in Bankruptcy

Beauty products business will get new owners and will field a board with executives from such companies as Bloomin’ Brands, Sephora and Walgreens

· Revlon’s bankruptcy ended nearly four decades of ownership by billionaire financier Ronald Perelman, who bought the company in 1985. It sought protection from creditors last year as it faced a heavy debt load, inflation and supply-chain pressures.

Revlon Inc. will emerge from bankruptcy under new ownership and a new board of directors that includes former executives from Bloomin’ Brands Inc., Sephora and Walgreens Boots Alliance Inc.

The reorganized beauty products company’s new board was selected by Glendon Capital Management LP, King Street Capital Management LP, Angelo Gordon & Co. and Nut Tree Capital Management LP, lenders to the business that are taking control in chapter 11.

Revlon’s bankruptcy ended nearly four decades of ownership by billionaire financier Ronald Perelman, who bought the company in 1985. It sought protection from creditors last year as it faced a heavy debt load, inflation and supply-chain pressures.

Debra Perelman, his daughter, has been Revlon’s chief executive officer. She will remain CEO as well as a board member as it passes to new owners.

Leading the new board as executive chair will be Elizabeth Smith, former CEO of restaurant chain operator Bloomin’ Brands, owner of dining concepts that include Outback Steakhouse. Ms. Smith is also former chair of the Federal Reserve Bank of Atlanta, and former president of Avon Products Inc. She also worked for 14 years at Kraft Foods Inc., ultimately serving as president of its U.S. beverages and grocery sector.

Ms. Smith currently serves on the boards of Hilton Worldwide Holdings Inc. and Authentic Brands Group LLC, and left the Bloomin’ board earlier this year.

“It’s no secret that the company has been under-resourced and burdened with a balance sheet” with too much debt, Ms. Smith told WSJ Pro Bankruptcy. “For the first time in years, Revlon will have the resources to reclaim its full potential.”

Revlon survived the worst of the Covid-19 pandemic, only to be driven to bankruptcy by supply-chain disruptions and inflationary pressures. It is expected to emerge from bankruptcy with $2.7 billion less debt, leaving roughly $1.5 billion of debt outstanding.

The New York-based company will no longer trade publicly. The equity interests of Mr. Perelman and other minority shareholders were wiped out in the chapter 11 case.

Other members of the new Revlon board will include: Martin Brok, former CEO of Sephora and a former regional president for Starbucks Corp.; Timothy McLevish, former chief financial officer at Walgreens; Hans Melotte, a former executive at Johnson & Johnson and at Starbucks, where his jobs included chief supply chain officer; and Paul Pressler, chairman of eBay Inc. and former CEO of Gap Inc. Mr. Pressler previously served on the boards of Avon, David’s Bridal Inc. and Gap.

Ms. Smith said the new Revlon directors are considered independent, unaffiliated with the lender group recapitalizing the business.

Holly Kim, a founding partner at Glendon Capital, said in a statement that the board members have proven records of revitalizing and building consumer brands. The value of Revlon is expected to be roughly $3 billion as it formally leaves bankruptcy in coming weeks.