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The retailer decided to split itself into two publicly listed companies, Victoria’s Secret and Bath & Body Works, in a deal that is expected to close in August.
![L Brands will spin off Victoria’s Secret instead of trying to sell it. (Published 2021) (1) L Brands will spin off Victoria’s Secret instead of trying to sell it. (Published 2021) (1)](https://i0.wp.com/static01.nyt.com/images/2021/05/11/business/11db-newsletter-victoriassecret/merlin_187375362_72384dc5-1e19-46e3-bbb9-7269e5a47295-articleLarge.jpg?quality=75&auto=webp&disable=upscale)
L Brands has decided to spin off Victoria’s Secret rather than sell it, the DealBook newsletter was the first to report.
The company said last year that it was considering separating Victoria’s Secret from the rest of its business, and it tested the interest of private equity. Ultimately, L Brands decided to split itself into two independent, publicly listed companies: Victoria’s Secret and Bath & Body Works. The deal is expected to close in August.
L Brands received several bids north of $3 billion, sources familiar with the situation said, requesting anonymity because the information is confidential. It turned the offers down, because it expects to be valued at $5 billion to $7 billion in a spinoff to L Brands shareholders. Analysts at Citi and JPMorgan Chase recently valued Victoria’s Secret as a stand-alone company at $5 billion.
“In the last 10 months, we have made significant progress in the turnaround of the Victoria’s Secret business, implementing merchandise and marketing initiatives to drive top line growth, as well as executing on a series of cost reduction actions, which together have dramatically increased profitability,” Sarah Nash, chair of the company’s board, said in a statement.
“The board believes that this path forward will return the highest value to shareholders and that the separation will allow each business to achieve its best opportunities for growth.”
The pandemic torpedoed a sale last year for much less. That agreement, announced in February 2020 with the investment firm Sycamore Partners, valued Victoria’s Secret at $1.1 billion.
Victoria’s Secret operating income
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