S&P: Revlon ratings unaffected by new loan

Standard & Poor's said Friday there would be no affect on the ratings or outlook on Revlon Consumer Products Corp. (CCC+/Negative/--) following the announcement that its liquidity position is expected to strengthen through the agreement by its principal stockholder, MacAndrews & Forbes Holdings Inc., to provide up to an additional $125 million in unsecured loans to Revlon.

The $125 million investment is subject to board of director approval and agreement on definitive terms.

S&P said the additional funds will be used to help finance Revlon's significant turnaround effort. While management has made progress in its efforts to stabilize the business and reverse the decline in market share, it has come at a cost given the substantial increase in brand support required to achieve these results.

While S&P said it views the cash injection as a positive move in the near term given Revlon's liquidity needs, the amount of the infusion does not address the company's longer-term liquidity problems resulting from ongoing negative cash flows.

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