Dive Brief:

• Revlon's biggest shareholder is exploring a possible sale of the beauty giant to a third party, the company's biggest shareholder said in a securities filing.
• The investor, holding company MacAndrews & Forbes, cautioned that there was no guarantee a sale would take place, nor has MacAndrews & Forbes "formulated any specific or definitive plan or proposal" as to a transaction around Revlon.
• The firm currently owns about 87% of Revlon. MacAndrews & Forbes said it and Revlon "expect from time to time to communicate with third parties as to the possibility of such transactions and related strategic, financial and other matters."

Dive Insight:

Revlon's financial picture has been darkening during a boom time for the beauty sector as a whole.

Unlike other brands betting on direct-to-consumer, Revlon still relies mainly on third-party retailers and its own marketing chops to keep consumers' attention.

Beauty has remained one of the bright spots in a tough retail climate. But it is also fiercely competitive. At retailers where it sells, Revlon competes with other major makeup producers like L'Oréal, Procter & Gamble and Estée Lauder, as well with an expanding volume of private label.

And the channels for competition are seemingly everywhere: department stores, mass merchants, wholesale, television shopping, door-to-door, specialty stores and one-stop shopping beauty shops like Sephora and Ulta — which are ever more important outlets and are increasingly seeking out DTC brands. Drugstores, too, are upping their beauty game, and not necessarily relying on Revlon to do so. Meanwhile, social media influencers have revolutionized the way makeup is marketed and sold.

Revlon currently carries more than $3 billion in debt and the company acknowledges that those levels could negatively affect its operations and flexibility. Meanwhile, the company's sales are falling. Last year, sales of the Revlon brand alone fell more than 10% in North America, to $522.3 million. The company as a whole saw its net loss widen to $294.2 million last year. Revlon has also gone through executive turnover in recent years. 

As its financial struggles mount, Fitch Ratings this summer added Revlon to its "Loans of Concern" list for a loan with an outstanding balance of $1.7 billion, due 2020.