A U.S. judge has approved Revlon Inc.’s reorganization plan, allowing the cosmetics maker to cut $2.7 billion from its debt and exit bankruptcy later this month, Reuters reported. Hon. David Jones, 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's reorganization was supported by 88% of the 4,500 creditors who voted on the plan, and those supporting creditors hold 98% of the company's debt. The reorganization will provide Revlon with a fresh start and provide a sustainable foundation for future growth, Revlon said in a court filing. Revlon’s existing equity shares will be wiped out when it emerges from bankruptcy.
