Citigroup has revived court proceedings against Revlon by suing the cosmetics major after failing to clawback $500mn from its lenders, following accidental payments to them in August 2020. The bank had accidentally transferred $900mn to Revlon’s lenders at the time. While almost ~$400mn was returned by a few lenders, 10 asset managers including Brigade Capital Management, HPS Investment Partners and Symphony Asset Management refused to return the funds, stating that Revlon had defaulted on its loan and thus the transferred amount was due to them. In its latest filing, Citi is claiming that it has effectively stepped “into the shoes of the funds” and is privy to the $500mn in claims from Revlon. Bloomberg notes that Revlon has refused to acknowledge Citi’s rights as its creditors, to which Citi’s lawyers said “unsurprisingly, neither the Revlon Group nor any other party-in-interest had ever articulated any legitimate legal or factual basis for challenging Citibank’s subrogation rights for inclusion in the DIP Orders…There is none.”
Citigroup’s 4% perps callable in 2025 are trading at 92.3, down by 1.1 points to yield 6.6%.
