Bankruptcy court approves sale of Morphe parent company Forma Brands
The proposed sale of Forma Brands to lenders Jefferies Finance LLC and Cerberus Capital Management has been approved by a US bankruptcy court.
Forma Brands, the parent company of Morphe Cosmetics, filed for voluntary Chapter 11 bankruptcy in the US Bankruptcy Court for the District of Delaware on 12 January 2023.
At the time, the firm announced it had entered into a definitive purchase agreement with a group of secured lenders, under which all of Forma Brands' assets would be acquired.
The proposed deal received court approval this week for $690 million in debt relief.
The transaction is expected to "significantly strengthen" the company's financial position and provide additional support for the execution of its long-term growth strategy, which will largely focus on global wholesale and e-commerce operations.
When the deal was first proposed in January, Simon Cowell, President of Forma Brands, said: "We will have additional financial resources available to invest in our multi-category portfolio, product launches and innovative brand and marketing strategy as we advance our vision to inspire creativity, promote inclusivity and connect with consumers around the world through beauty."
The agreement, which included all existing inventory, was estimated at $15 million, according to Bloomberg. It also reported that Forma Brands had already agreed to end its licensing agreement with r.e.m. beauty shortly before its Chapter 11 filling.