L Brands Scraps Deal To Sell Victoria's Secret
Victoria’s Secret won’t be bought after all. L Brands, which owns the lingerie seller, said Monday that it has agreed to end a February deal that would have sold a controlling stake of Victoria’s Secret to private equity firm Sycamore Partners.
Last month, Sycamore Partners sued to get out of the $525 million deal, citing the coronavirus pandemic, which forced the chain to close its stores and lose sales.
On Monday, L Brands said the lawsuit with Sycamore Partners was settled. L Brands said it now plans to spinoff Victoria’s Secret into a separate company and focus on running its Bath & Body Works chain.
“Like all retailers, the company faces an extremely challenging business environment," said a statement from Sarah Nash, the current director of and future chair of L Brands’ Board. "Our Board believes that it is in the best interests of the company, our stockholders and our associates to focus our efforts entirely on navigating this environment to address those challenges and positioning our brands for success rather than engaging in costly and distracting litigation to force a partnership with Sycamore.”
L Brands founder, CEO and chairman of the board Les Wexner will step down on May 14. He will remain a member of the board of directors as chairman emeritus.