Pat McGrath Labs Exits Bankruptcy With a New Owner

After months of deliberations and a week of hearings in a Florida bankruptcy court, makeup label Pat McGrath Labs will exit the Chapter 11 process with a new owner, a judge said on Friday.

GDA Luma, the Miami-based investment firm founded by entrepreneur Gabriel de Alba and the brand’s largest creditor, will assume control of Pat McGrath Labs by establishing a new holding company. Founder Pat McGrath will assume the role of chief creative officer in the new organisation, but will transfer her equity to GDA Luma.

The investment firm has pledged $65 million of financing, according to a release issued by GDA Luma on Monday, including a $20 million exit loan from its new parent pre-approved by the court in February, as The Business of Beauty reported. The holding company will license all intellectual property owned by Pat McGrath Labs from McGrath.

Representatives for Pat McGrath Labs and GDA Luma did not immediately respond to requests for comment.

Friday’s hearing capped off a monthslong Chapter 11 process, initiated on Jan. 22, that saw GDA Luma attempt to wrest control of the beauty brand it invested in just last year. Once valued at $1 billion, the makeup artist Pat McGrath’s eponymous cosmetics line has experienced operational struggles and declining sales for years. The brand was recently shopped out to potential acquirers during the process, BoF reported; bankruptcy filings show that, while 66 parties were contacted, only one made an offer that was “materially” beneath the $43 million GDA Luma alleged was owed.

GDA Luma will own 100 percent of the new holding company, according to filings, with $500,000 in preferred equity distributed to secured creditor Keyhaven Capital Partners, who said they invested over $11 million in the brand in late 2024. All other existing equity would be cancelled.

Approximately 327 smaller creditors — reflecting a mix of business services from Google to Slack, cosmetic manufacturers like Intercos and Ancorotti Cosmetics, shippers, modeling agencies, fashion brands and retailers, freelance makeup artists and corporate employees — will be paid at least partially from a liquidating trust, according to the filings.

On Monday, US Southern District of Florida judge Laurel Isicoff delayed confirming the restructuring plan after Keyhaven Capital Partners objected to the deal, alleging that it maximises value for GDA Luma rather than creditors. Judge Laurel Isicoff overruled Keyhaven’s objection on the grounds that the company’s hard assets were less than the amount owed to GDA Luma.

By Friday the parties had reached an agreement that saw McGrath cede her equity to GDA Luma. Her lawyer, Joseph Pack, opened the hearing by announcing her role as chief creative officer. “It’s excellent news for the company and all parties of interest,” Pack said.

During the bankruptcy process, the brand has forged on with its 2026 plans: Pat McGrath Labs launched a double-sided lip pencil in March that was teased on models during Paris Fashion Week, and founder McGrath appeared at the recent Sephoria for a masterclass, recreating looks from the previous runway season.

A week later, on Monday, McGrath took her seat before the court, appearing in a floor-length black coat and her signature black headband. The whole room addressed her as Dame.

“I’m happy for you that you will be able to continue the legacy and the company that you love,” Isicoff told McGrath, “I look forward to being in a position where I can actually go buy the makeup.”

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Editor’s Note: This article was amended on April 20 2026 to include information from a GDA Luma press release issued after publication.