Private equity tipped to privatise Victoria’s Secret

L Brands is reportedly about to announce the sale of its troubled Victoria’s Secret lingerie business to private-equity company Sycamore Partners. 

The move would leave L Brands with just one retail business – the fast-growing Bath & Body Works, which in some US malls is reporting sales growth at 1000 basis points ahead of the shopping centres they are located in. 

Victoria’s Secret sales are down 8 per cent year on year in the current fiscal year, while Bath & Body Works sales were up 9 per cent in November and December.  

Whispers of a potential sale emerged in early January when it was widely reported that founder Les Wexner was planning to step down and cash up. Now, CNBC has reported that Sycamore Partners is the likely bidder with a deal to be announced as early as this week. 

The lingerie chain is losing market share to American Eagle Outfitters’ Aerie brand, along with Direct-to-consumer brands and one analyst, the Motley Fool described it as “losing relevance”. Last year the company discontinued its high-profile televised fashion show and the company is believed to be reviewing the future of its giant flagships as sales soften. The company’s heavy reliance on promoting sexy attire is missing its mark in a market where consumers are expecting more inclusive and diverse underwear styles.  


The future of L Brands is less certain, despite the success of Bath & Body Works, given that the Victoria’s Secret business currently accounts for the vast majority of its US$13 billion annual turnover. Bath & Body Works may be sold to a different buyer or remain a standalone business under L Brands. 

In January last year, L Brands sold the La Senza lingerie chain to Californian private-equity company Regent. 

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