Pat McGrath Labs, the makeup brand founded in 2015 by British makeup artist Dame Pat McGrath, has initiated a financial restructuring process under judicial supervision in the United States, a mechanism that allows the company to continue operating while renegotiating its debt with creditors.
The request was filed on January 22 before a U.S. federal court and has led to the temporary cancellation of the asset auction that the company had planned for the end of the month, a process that was being managed by Hilco Global and contemplated the possible total or partial sale of the company.
Unlike a liquidation, this procedure offers the company **protection from its creditors** while it designs a plan to reorganize its financial structure and ensure its medium-term viability
From a brand valued at over 1 billion to restructuring its financial structure
Pat McGrath Labs achieved unicorn status in 2018, following a $60 million investment led by Eurazeo Brands, which placed its valuation above $1 billion and consolidated its position in the premium makeup segment.
Since then, however, the business's evolution has been marked by a progressive deterioration of its valuation. Eurazeo's exit from the shareholder base and the entry of new investors with downwardly adjusted stakes reflected the company's growing financial tensions. According to specialized media, some stakes have depreciated significantly compared to their initial value
In the documentation submitted to the court, Pat McGrath Labs acknowledges **debts ranging between $50 and $100 million**, a figure that contrasts with the growth expectations that accompanied the brand during its expansion phase.
What this process entails and what it does not
The procedure initiated by Pat McGrath Labs does not imply the closure of the company or the immediate cessation of its activity. The company can continue to manufacture, market, and distribute its products while negotiating new terms with suppliers and creditors.
The brand has confirmed that it will continue to operate normally through its main sales channels, including its online store and retailers such as Sephora and Ulta Beauty, while the financial restructuring process moves forward.
This type of restructuring has become a common tool among consumer companies looking to buy time, preserve brand value, and avoid a forced sale in a context of financial pressure.
A Brand on Strategic Pause
Although the company is going through a key moment, Pat McGrath's figure maintains her intact weight in the industry. In 2025, the makeup artist was appointed creative director of Louis Vuitton's new beauty division, reinforcing her position as one of the most influential names in the sector globally.
The evolution of the restructuring process will determine whether Pat McGrath Labs manages to stabilize its financial structure or if, ultimately, it opts for a partial or total sale of its assets. In any case, the move marks a turning point for one of the most emblematic brands in contemporary makeup.