Indian conglomerate Reliance Industries (RIL) is planning to acquire US-based Revlon Inc, days after the cosmetics giant filed for bankruptcy, citing sources ET Now reported.
US-based cosmetics brand Revlon filed for bankruptcy earlier this week after the company faced global supply chain disruptions which drove up raw material costs and prompted vendors to demand upfront payments.
According to the report, Reliance recently has pushed its way into the fashion and personal care space as it diversifies away from its mainstay oil business. The Mukesh Ambani-led firm has already established a foothold in telecom and retail sectors.
In its court filing on Wednesday, Revlon applied for Chapter 11 proceedings of bankruptcy to manage its debt, which reportedly stood between $1 billion and $10 billion.
Owned by billionaire Ron Perelman’s MacAndrews & Forbes, the 90-year-old cosmetic brand, sought court protection in the Southern District of New York as it its listed assets totalling $2.3 billion as of late April and debts of $3.7 billion.
Chapter 11 proceedings of bankruptcy allow a firm to continue operating while it works out a plan to repay creditors.
In an official statement, Revlon said that it is expecting to receive $575 million in funds from its existing lenders to fund itself during bankruptcy.
Revlon CEO Debra Perelman in a statement said, “Today's filing will allow Revlon to offer our consumers the iconic products we have delivered for decades, while providing a clearer path for our future growth.”
Shares of Revlon, which witnessed a net loss of $67 million from January to March 2022, zoomed 20 per cent to $2.36 in premarket trade following the report, while shares of Reliance were up 1.9 per cent on the BSE.
However, Reliance and Revlon did not immediately respond to Reuters’ requests for comment.