Free Subscription

  • Access 15 free news articles each month


Try one month for $4
  • Unlimited access to news,insights and opinions
  • Quarterly and weekly magazines
  • Independent research reports and forecasts
  • Quarterly webinars with industry experts
  • Q&A with retail leaders
  • Career advice
  • 10% discount on events

Victoria’s Secret deal may be off as L Brands, Sycamore head to court

Sycamore Partners’ rescue plan for troubled lingerie retailer L Brands is all but off with the two companies headed to court after the private-equity company unilaterally cancelled the bid. 

Sycamore agreed to pay US$525 million for a 55 per cent stake in L Brands, the parent of Victoria’s Secret, back in February in a deal most analysts at the time considered a bargain. But the subsequent advent of the coronavirus pandemic which saw most of the company’s stores shuttered, decimating sales, has made L Brands even less desirable, even at that price.  

On Wednesday, Sycamore notified L Brands it was terminating the deal, a move the target company described as “invalid”. 

Sycamore is claiming that by closing stores, laying off staff and withholding rent, L Brands was in breach of the sale agreement under which the retailer was obliged to continue to conduct business ‘as usual’ ahead of settlement.

In a statement, L Brands said it would “vigorously defend the lawsuit and pursue all legal remedies to enforce its contractual rights, including the right of specific performance”. 

L Brands’ share price took a 20-per-cent hit in the wake of Sycamore’s actions. 

You have 7 free articles.