Victoria’s Secret CEO to resign as company is sold
Victoria’s Secret CEO Les Wexner announced Thursday that he will step down from his position as part of a deal to sell the company to a private equity firm.
L Brands, which owns Victoria’s Secret, will sell 55 percent of the lingerie company to Sycamore Partners for $525 million. L Brands will still own the other 45 percent of the company, sharing control with Sycamore. Victoria’s Secret will then become a fully private company.
Wexner, 82, founded L Brands, Victoria’s Secret’s parent company, in 1963. After the deal is finalized, he will leave his roles as chairman and CEO of Victoria’s Secret. However, he will still be active with the company as a chairman emeritus.
Victoria’s Secret has been declining as women demand more comfortable, body positive products. According to L Brands, same-store sales declined 10% at Victoria’s Secret during the fourth quarter. Stock in the company trades at around $24, as opposed to nearly $100 in 2015.
The Victoria’s Secret fashion show being pulled from network television in Nov. 2019 because of controversy and low rating also indicated the company’s decline.
Victoria’s Secret was founded in 1977 by Roy Larson Raymond and bought by Wexner in 1982.
L Brands is based out of Columbus, Ohio. According to FactSect, Wexner owns over 16 percent of L Brands. The most notable company under its ownership is Bath & Body Works.
Wexner had ties to Jeffery Epstein, the financier indicted on sex-trafficking charges before dying by suicide in jail in 2019. Epstein had managed Wexner’s money and had power of attorney of the Wexner Foundation. Wexner, however, affirms he cut ties with Epstein after hearing allegations of his sexual abuse of young girls in 2007.
Sycamore Partners is a private equity firm that currently manages $10 billion in assets. Its investments include Belk, Hot Topic, Talbots and Coldwater Creek.
For fans of Victoria’s Secret products or the fashion show, this deal will be a test of whether or not the brand can reinvent itself and survive in a society that is increasingly more interested in promoting body positivity and comfort than supermodels in lacy underwear and wings.
Attribution:
https://apnews.com/d00ca1487737d4c28f2e239e6d4d3a09
https://www.foxnews.com/entertainment/victorias-secret-sale-525-million-ceo-les-wexner-step-down
