Revlon given $150m cash makeover
Revlon, the troubled American cosmetics company, is to receive a $150m (£94m) cash injection from its chairman, arch-investor Ron Perelman, to help it avoid a potential cash crisis.
The move comes only two months after the make-up maker brought in Jack Stahl from Coca-Cola to try to revive its fortunes. Mr Stahl has already made his mark, cutting some underperforming lines and slashing prices on others.
Revlon also has a massive promotion running over Christmas, tied in with the James Bond film Die Another Day and featuring the film's female star Halle Berry. Ms Berry replaces Cindy Crawford, Revlon's "spokesperson" for 11 years.
Analysts have expressed worries about how Revlon is going to pay for Mr Stahl's plans, given it has over $1.7bn of long-term debt and a market value of less than $100m. It has been struggling against US competition from L'Oréal, with its Maybelline range, and Procter & Gamble, maker of Max Factor and Cover Girl.
But market research shows Revlon is starting to make headway. October figures revealed its share of the US cosmetics market had risen from 21 to 23 per cent, overtaking P&G, at 21 per cent. The market leader is still L'Oréal, with a 33 per cent share.
Mr Perelman's lifeline to Revlon comes in the form of a $100m loan and $50m purchase of new shares. He already owns shares giving him 97 per cent of Revlon's voting rights, having bought the company for $1.8bn in 1985.
A corporate raider who made his fortune with audacious deals in the 1980s, Mr Perelman is a socialite and staunch Democrat, numbering Bill Clinton among his friends.
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