L Brands is back in sale with potential buyers for its Victoria’s Secret lingerie brand, according to a new report.
According to the report, it seeks possibly more than double the $1.1 billion valuation that it had roughly one year ago when a prior deal did not materialise.
Hinging on Victoria’s Secret’s recent sales momentum, the company could now target a valuation of at least, a sum of $2 billion to $3 billion in a potential sale.
Sycamore Partners sued L Brands last April, to terminate a deal that would have given the private equity firm 55% control of the lingerie chain, for around $525 million. It argued that L Brands had allegedly violated the terms of their agreement, as it failed to pay rent and furloughed workers during the Covid pandemic. L Brands avoided a legal battle by agreeing to call off the deal.
Since the holidays, L Brands’ management team has called out gaining momentum at the lingerie chain. The company has already boosted its profit outlook for the first quarter twice, banking on the heightened shopper demand at Victoria’s Secret.
It appointed Martin Waters as CEO of Victoria’s Secret last November, effective immediately and he succeeded John Mehas, who had only been in the role for about two years.
Former Chairman Les Wexner, who has been associated with convicted sex offender Jeffrey Epstein, also relinquished his chair seat in February 2020. Wexner and his wife, who are both on the company’s board, will not be up for reelection at an upcoming annual shareholders meeting, either.
L Brands has said it expects completing either a sale or a spinoff of Victoria’s Secret by August.
L Brands shares were up more than 1% on Friday morning. The stock has risen over 75% year to date. The company has a market capitalization of more than $18.5 billion.
