Dhe lingerie label “Victoria’s Secret”, which is already suffering due to image problems and falling sales figures, faces new problems due to the corona crisis. The financial investor Sycamore Partners wants to cancel the takeover agreed in February of a 55 percent majority stake in the fashion brand, as “Victoria’s Secret” parent company L Brands confirmed on Wednesday. Sycamore has filed a lawsuit with a Delaware court to reverse the deal. L Brands insists on the purchase contract and wants to defend himself vigorously.
It was actually decided that Sycamore Partners would have the majority control for $ 525 million ($ 485 million) and the remaining 45 percent would remain with L Brands. Overall, Victoria’s Secret was valued at $ 1.1 billion in the deal. However, because L Brands closed numerous branches, took leave of absence and suspended rental payments in the wake of the corona pandemic, the agreement was void, Sycamore argues, according to American media reports. L Brands’ stock temporarily fell over 25 percent on the stock exchange and was briefly suspended from trading.
“Victoria’s Secret” has long since developed from the figurehead to a problem at the parent company L Brands. The lingerie label, which always sent the international elite of top models on the catwalk at its pompous fashion shows, has been struggling for a long time. With its “Sex Sells” marketing, which focuses on flawless, lightly dressed women’s bodies, the label became a stumbling block in times of lively “Body Shaming” debates and the “#MeToo” movement. Reports of harassment allegations against managers recently put pressure on the underwear brand.
The agreement with Sycamore had also provided for L Brand’s controversial boss Leslie Wexner to step down as soon as the transaction was completed. But he should continue to hold a position on the board, it was said in February. The 82-year-old’s reputation has suffered heavily from his connection to American millionaire Jeffrey Epstein, who committed suicide in a New York prison last August after an abuse scandal. Wexner is said to have maintained close business relationships with Epstein for a long time, which led to fierce criticism of the L-Brands boss.