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Court Approves GDA Luma Financing for Pat McGrath Labs Recapitalization
The deal provides up to $30 million in fresh capital to support the company through its Chapter 11 process.
Published on Feb. 18, 2026
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The court has approved financing from GDA Luma Capital Management to support the recapitalization of Pat McGrath Labs, a leading beauty brand. The deal includes up to $30 million in new financing, with GDA Luma taking a controlling equity stake upon the company's emergence from Chapter 11 bankruptcy. Founder Dame Pat McGrath will remain a significant equity owner and continue as Chief Creative Officer.
Why it matters
The recapitalization of Pat McGrath Labs represents a critical moment for the iconic beauty brand, which has shaped the modern beauty industry for over a decade. The influx of capital and operational expertise from GDA Luma is expected to position the company for long-term growth and sustained cultural relevance.
The details
The financing package includes up to $10 million in Debtor-in-Possession financing, as well as a further commitment of at least $20 million in post-emergence working capital. GDA Luma will hold a controlling equity stake in the company upon its exit from Chapter 11, while founder Dame Pat McGrath will remain a significant owner and continue as Chief Creative Officer.
- The court approval of the financing deal was announced on February 17, 2026.
- The full recapitalization is expected to be completed in the coming weeks.
The players
GDA Luma Capital Management
A registered private equity firm specializing in distressed-for-control debt and special situations investments, providing capital solutions, turnaround expertise, and digital transformation strategies to middle market companies.
Pat McGrath Labs
A leading beauty brand known for its audacious artistry, cultural relevance, and singular creative vision, founded by Dame Pat McGrath.
Dame Pat McGrath
The founder of Pat McGrath Labs, who will remain a significant equity owner and continue as Chief Creative Officer.
Paladin Management Group
A firm that has been retained to act as Chief Restructuring Officer during the Chapter 11 process.
Gordian Group LLC
The investment banker acting on behalf of Pat McGrath Labs.
What’s next
The parties expect the full recapitalization to be completed in the coming weeks.
The takeaway
The recapitalization of Pat McGrath Labs by GDA Luma represents a significant investment in preserving the brand's creative legacy and positioning it for long-term growth and success in the highly competitive beauty industry.
