Sycamore Partners buys 55% stake in Victoria's Secret

21 Feb '20
2 min read
Pic: Shutterstock
Pic: Shutterstock

Sycamore Partners recently acquired a 55 per cent stake in Victoria’s Secret for nearly $525 million while the latter’s parent firm L Brands retains the rest. L Brands will position Bath & Body Works as a profitable, standalone public firm and separate Victoria’s Secret into a private entity focused on returning its businesses to earlier levels of profitability.

L Brands owns Victoria’s Secret, PINK and Bath & Body Works and operates 2,920 company-owned specialty stores in the United States, Canada, the United Kingdom and Greater China. Victoria’s Secret’s business include Victoria’s Secret Lingerie, Victoria’s Secret Beauty and PINK. Sycamore Partners is a New York-based private equity firm specialising in consumer and retail investments.

The transaction was approved by a unanimous vote of the L Brands board of directors. Under the terms of the transaction, Victoria’s Secret, with a total enterprise value of $1.1 billion, will be separated from L Brands into a privately-held company majority-owned by Sycamore, according to a press release from L Brands.

The company intends to use the proceeds from the transaction, along with approximately $500 million in excess balance sheet cash, to reduce debt.

Upon the closing of the transaction, Leslie Wexner, chairman and chief executive officer (CEO) of L Brands, will step down. He will remain a member of the board as chairman emeritus. Nick Coe, CEO of Bath & Body Works, has been named vice chairman of Bath & Body Works Brand Strategy and New Ventures. Andrew Meslow, chief operations officer of Bath & Body Works, has been promoted to CEO position. At the close of the transaction, Meslow will become CEO of L Brands and will join its board.

Meslow, who joined L Brands in 2003, has 29 years of experience in the retail industry, the last 15 at Bath & Body Works.

Fibre2Fashion News Desk (DS)

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