Victoria's Secret Owner Sells Majority Stake for $525 Million

Models walk the runway during the 2018 Victoria's Secret Fashion Show at Pier 94

Models walk the runway during the 2018 Victoria's Secret Fashion Show at Pier 94

In 1995, Victoria's Secret launched the brand's first annual fashion show, which features supermodels sporting barely-there lingerie while wearing massive wings, heavy makeup and six-inch heels.

Victoria's Secret is SOLD.

Victoria's Secret's parent company has also sold a controlling stake in the brand, selling 55% of it for $525 million.

The move officially places L Brands' most talked-about brand in private hands, and values the lingerie retailer at just $1.1 billion, a fairly paltry sum for a company with over 1,600 stores worldwide.

According to the L Brands announcement, Wexner will step down when the deal is completed but remain on the board as chairman emeritus. Wexner has been grappling with his own troubles, such as thoughts more than his ties to the late financier Jeffrey Epstein, who was indicted on sex-trafficking expenses. At the close of the transaction, Meslow will become CEO of L Brands and will join its board. Though it was once a shopping mall fixture, the brand faced steep competition from other lingerie labels that focused on inclusivity, like Thirdlove, Aerie, and Rihanna's Savage x Fenty line.

The selling price signifies a marked decline for a brand with hundreds of stores that booked about seven billion dollars (£5.4 billion) in revenue previous year. These additions helped L Brands widen its empire into new areas like sporting goods and luxury, at the now-defunct stores Galyan's Trading Company and Henri Bendel, respectively. "Sycamore, which has deep experience in the retail industry and a superior track record of success, will bring a fresh perspective and greater focus to the business".

Still, the sale of Victoria's Secret feels inevitable.

As social norms defining beauty and sexiness have changed over the years, Victoria's Secret has stuck to the same playbook and lost a large number of customers to its competitors.

Many experts say the executives running the company were in a sense designing for men, not for women.

The management workforce at Victoria's Key primarily was creating what guys want, not what women of all ages want, said Neil Saunders, handling director of GlobalData Retail.

Models walk the runway during the 2018 Victoria's Secret Fashion Show at Pier 94
Models walk the runway during the 2018 Victoria's Secret Fashion Show at Pier 94

Stacey Widlitz, president of SW Retail Advisors, a retail consultancy, mentioned that Victoria's Secret types in the very last couple of years had been heading in the reverse direction of what women desired, ever sexier and poorer high quality.

"They were going down a rabbit hole", she said.

FILE - In this June 7, 2017 file photo, shoppers look at merchandise at a Victoria's Secret store in Hialeah, Fla. Earlier, Victoria's Secret's total enterprise was valued at $1.1 billion. L Brands stated Thursday that exact-store sales declined 10% at Victoria's Magic formula during the fourth quarter.

Stepping into Wexner's role will be Andrew Meslow, chief operating officer of Bath & Body Works. That glamour has faded and so have sales.

Its televised fashion show, which began in 2001, was cancelled past year as the number of viewers dwindled.

The company has been beset by allegations of a toxic work environment and its founder recently apologized for his ties to Epstein, who was found hanged in his jail cell after his indictment. The company canceled the 2019 fashion show and it's unclear what the future for the brand will hold.

Mr Wexner has said he completely severed ties with Epstein almost 12 years ago and accused him of misappropriating "vast sums" of his fortune.

Wexner supplied an apology at the opening handle of L Brands' once-a-year trader working day past fall, indicating he was "humiliated" by his former ties with Epstein.

Over the course of several decades, L Brands evolved from a humble women's clothing store in Columbus, Ohio, into a full-fledged retail behemoth.

Wexner was the longest-tenured CEO of the S&P 500 companies, having served as head of L Brands for 57 years, as per a Business Insider report. The firm's investment portfolio includes retailers such as Belk, Coldwater Creek, Hot Topic and Talbots. L Brands' bath shop chain Bath & Body Works will become a separate public company.

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