It looks like Revlon Inc. will be refinancing, after all.
A source with direct knowledge of the deal said that Revlon had reached an agreement to close a $1.8 billion refinancing package.
The deal has Jefferies Finance LLC providing two senior secured term loans, the source confirmed: one for $880 million that would be used to pay off the $200 million term loan Revlon got from Ares in 2019 that’s secured by American Crew, as well as for expenses related to refinancing and general corporate purposes; another for $950 million in order to roll up loans from a 2016 facility. The facilities would mature on June 30, 2025.
Revlon also closed another $65 million loan April 30.
For the loan agreement with Jefferies to go through, 50 percent of existing lenders needed to agree to the deal, which the source said they had.
Some members of the group resisted, resulting in talks that had been ongoing since the first refinancing agreement was proposed in March. Another source said the group didn’t want the facility to go through because it would put them in a “very junior position.”
For Revlon, the refinancing is a big deal. The business has struggled for years, and with looming debt maturities, had engaged Goldman Sachs to sell all or parts of the business in order to pay down that debt. The refinancing facility is said by sources to take that pressure off, — and also, to allow Revlon some capital to reinvest in the business.
The business’ latest turnaround efforts, unveiled in March with the refinancing package, included layoffs and other cost-cutting initiatives. When the coronavirus hit, Revlon was one of many beauty companies to take additional cost-cutting measures, furloughing some staff, cutting executive pay and asking other employees to work reduced hours.
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