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By Becky Yerak
This article is being republished as part of our daily reproduction of WSJ.com articles that also appeared in the U.S. print edition of The Wall Street Journal (August 16, 2019).
Revlon Inc. has hired Goldman Sachs Group Inc. to help review strategic alternatives, including the sale of all or parts of its business, as the cosmetics maker copes with changing consumer tastes, a person familiar with the matter said.
The New York-based company, which is controlled by billionaire Ron Perelman's investment firm, is considering all its options, including a sale of all or some parts of its business, the person said.
Like a number of mainstream cosmetics companies, Revlon has struggled to keep its grip on American shoppers. The company has faced multiple challenges, including competition from startups by celebrity founders such as Kylie Jenner, as well as loss of market share to larger competitors such as L'Oréal SA and the failure to reap benefits from its acquisition of Elizabeth Arden Inc. a few years ago.
MacAndrews & Forbes Inc., the investment vehicle controlled by Mr. Perelman, has stepped in twice in recent years to loan the cosmetics maker millions of dollars.
Revlon's shares closed at $15.36, up about 5.5% on Thursday. The New York Stock Exchange briefly halted trading of the company's shares Thursday afternoon because of volatility. Revlon's shares have lost about 40% of their value this year.
Last week, Revlon reported quarterly results that fell short of expectations, but it also said it received a $200 million term loan that it would use to invest in its business. One analyst said that capital infusion arrived "just in time" as Revlon had been cutting back on capital expenditures and display purchases.
Revlon's sales were $570.2 million in the second quarter, down from $606.8 million during the prior-year period. The company posted a $63.7 million net loss in the second quarter, an improvement considering the prior-year period had a loss of $122.5 million.
The $200 million loan from credit-focused investment firm Ares Management LLC provides a path for the New York-based company to refinance $500 million in bonds maturing in 2021. Earlier this year Revlon said it planned to refinance that debt by the end of this year, despite its financial struggles.
--Sharon Terlep contributed to this article.
Write to Becky Yerak at email@example.com
(END) Dow Jones Newswires
August 16, 2019 02:47 ET (06:47 GMT)
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