Leslie H. Wexner will step down as L Brands Inc. chairman and CEO, and the company will sell its Victoria’s Secret and PINK brands to Sycamore Partners for $1.1 billion, the company announced in a Feb. 20 news release.
The sale will leave its Bath & Body Works brand as a standalone public company.
“Les Wexner is a retail legend who has built incredible brands that are household names around the globe,” said Allan Tessler, lead independent board director, in the release. “His leadership through this transition exemplifies his commitment to further growth of Bath & Body Works and Victoria’s Secret and driving overall shareholder value.”
According to the Sycamore Partners website, in February 2017 the New York City firm also acquired The Limited, L Brands’ first store chain, and other intellectual property assets out of bankruptcy.
L Brands, which is based in Columbus, reported Nick Coe, Bath & Body Works’ CEO, was named vice chairman of Bath & Body Works Brand Strategy and New Ventures.
Andrew Meslow, COO of Bath & Body Works, has been named CEO of that brand, and after the transaction with Sycamore is complete, he will become CEO of L Brands and serve on its board. Meslow has 29 years of experience in the retail industry, spending the last 15 years at Bath & Body Works.
Wexner will remain on L Brands’ board as chairman emeritus.
“We believe this structure will allow Bath & Body Works – which represents the vast majority of 2019 consolidated operating income – to continue to achieve strong growth and receive its appropriate market valuation. The transaction will also allow the company to reduce debt,” Wexner said in the release.
As a result of this transaction, L Brands reported it will retain a 45% stake in Victoria’s Secret, and L Brands “intends to use the proceeds from the transaction along with approximately $500 million in excess balance sheet cash, to reduce debt.”
Speculation about such a sale and Wexner stepping down has been reported by news outlets over the past couple weeks. The New York Times reported shares of L Brands have fallen more than 75% from their 2015 peak. In addition to poor sales and profit, the chain canceled its annually televised Victoria’s Secret Fashion Show and has been criticized for its outdated branding in the #MeToo era.
In a Feb. 1 investigative report in The New York Times, Wexner and Ed Razek, the company’s former chief marketing officer, were accused of presiding over a corporate culture of misogyny, bullying and harassment. The Times reported several employees were harassed by Razek and faced retaliation when reporting the incidents.
In 2019, Wexner said the late financier and convicted sex offender Jeffrey Epstein misappropriated “vast sums” of Wexner’s fortune while managing his personal finances more than a decade ago.
In spite of financial woes and alleged business missteps, Wexner’s influence and name, particularly in the realm of philanthropy, extend beyond his company’s Central Ohio headquarters. He founded the Wexner Foundation in New Albany, which is known internationally for its Jewish leadership programs. Wexner Heritage Village is a senior housing facility in Columbus, and in 2012, the hospital at The Ohio State University became The Ohio State University Wexner Medical Center. Wexner also provides student scholarships through the Wexner Graduate Fellowship.