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Revlon (NYSE:REV) stock is in the red this morning after rising by as much as 30% yesterday. Earlier this week, the 2nd U.S. Circuit Court of Appeals denied a request for Revlon lenders — such as Brigade Capital Management and Symphony Asset Management — to review a three-judge panel’s ruling that said they must pay back $504 million erroneously wired to them by Citigroup (NYSE:C) in 2020.
The lenders can still take the case to the Supreme Court, although Bloomberg Intelligence senior litigation analyst Elliott Stein believes the court will not take up the case. The lenders have up to 90 days to file a petition with the court.
Citigroup was reportedly “pleased” with the decision and added that the “mistakenly transferred funds should be returned as a matter of law, as well as ethics.”
Back in June, Revlon filed for Chapter 11 bankruptcy. The makeup and cosmetics company attributed its woes to a lack of raw materials, as well as a high debt load that caused it to be unable to make timely payments to vendors. At the time, the company expected to receive “$575 million in debtor-in-possession financing from its existing lender base.”
However, shares of REV stock are up more than 100% since June 16 as investors speculate that a potential buyout could send shares higher. Revlon may also be primed for a short squeeze. As of Sept. 30, REV’s percentage of float shorted totaled 25.3%, equivalent to 1.9 million…
