US-based cosmetics maker and marketer Revlon has secured approval from a bankruptcy court to borrow $375m to address supply chain issues.
The move comes after the company recently filed for Chapter 11 bankruptcy, citing disruptions in supply chains and rising costs.
According to a Reuters report, US Bankruptcy Judge David Jones in New York approved the loan to help Revlon deliver retail customer orders.
The company’s chief restructuring officer, Robert Caruso, testified to the court that several of its raw material vendors had suspended deliveries, seeking payment settlements.
Caruso said that the company would not be able to meet demands without access to raw materials.
He added that Revlon will keep $300m of the loan for daily business activities, while the remaining amount will be used to pay debts incurred at foreign subsidiaries that are not part of the bankruptcy.
Revlon had previously said that it expects to receive $575m in financing from existing lenders to support its day-to-day operations.
Apart from its Canadian and UK business units, none of the company’s international subsidiaries are part of the Chapter 11 proceedings.
At the time of announcing the bankruptcy filing, Revlon president and CEO Debra Perelman said: “Consumer demand for our products remains strong – people love our brands, and we continue to have a healthy market position.
“But our challenging capital structure has limited our ability to navigate macro-economic issues in order to meet this demand.
“By addressing these complex legacy debt constraints, we expect to be able to simplify our capital structure and significantly reduce our debt, enabling us to unlock the full potential of our globally recognized brands.”
In a separate development, Indian conglomerate Reliance Industries is planning to acquire Revlon, according to a report from business channel ET Now.