Shoppers stand in line waiting for a Victoria’s Secret store to open on Black Friday at Tysons Corner Center in Tysons, Virginia on November 27, 2020.
Hannah McKay | Reuters
L Brands is back in sales pitches with potential buyers for lingerie brand Victoria’s Secret, in which the company may be targeting more than double the $ 1.1 billion valuation it had about a year ago, according to a new report when a previous deal fell apart.
Given Victoria’s Secret’s recent sales momentum, the company could now aim for a valuation of at least $ 2-3 billion for a potential sale, Bloomberg reported Friday, citing people familiar with the private negotiations.
A representative from L Brands, who also owns Bath & Body Works, did not immediately respond to CNBC’s request for comment.
Sycamore Partners sued L Brands last April for terminating a deal that would have given the private equity firm 55% control of the lingerie chain for around $ 525 million. It has been argued that L Brands violated the terms of their agreement by failing to pay rent and taking workers off during the Covid pandemic. L Brands prevented a lawsuit by agreeing to break off the deal.
Since the holidays, the L Brands management team has highlighted the growing dynamism of the lingerie chain. The company has already improved its earnings outlook twice for the first quarter, citing increased demand for buyers at Victoria’s Secret.
Last November, Martin Waters was named CEO of Victoria’s Secret, effective immediately. He succeeded John Mehas, who had only been in the role for about two years.
Former chairman Les Wexner, who has been linked to convicted sex offender Jeffrey Epstein, also resigned from his seat in February 2020. Wexner and his wife, both of whom are on the company’s board of directors, won’t be re-elected at the upcoming annual shareholders meeting either.
L Brands has announced that it will either sell or spin off Victoria’s Secret by August.
L Brands shares rose more than 1% on Friday morning. The stock is up over 75% since the beginning of the year. The company has a market capitalization of more than $ 18.5 billion.
Read Bloomberg’s full report here.