Bath & Body Works, Inc.

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Bath & Body Works, Inc.
TypePublic
NYSEBBWI
S&P 500 Component
IndustryRetailing
Founded1963; 58 years ago (1963)
FounderLeslie H. Wexner
DefunctAugust 2021
HeadquartersColumbus, Ohio, U.S.
Key people
Andrew Meslow (CEO)
Charles McGuigan (COO)
Martin Waters (CFO)
ProductsClothing, fashion accessory
RevenueDecrease US$12.914 billion (2019)[1][2]
Decrease US$978 million (2019)[2]
Decrease –US$366.4 million (2019)[1]
Total assetsIncrease US$10.125 billion (2019)[1][3]
Total equityDecrease –US$1.499 billion (2019)[3]
Number of employees
59,950 (2019)[1]
SubsidiariesBath & Body Works
Websitewww.bbwinc.com

Bath & Body Works, Inc. (formerly known as L Brands, Inc., Limited Brands, Inc. and The Limited, Inc.) is an American specialty retailer based in Columbus, Ohio. It owns Bath & Body Works, posted $12.914 billion in revenue in 2019, and was listed as 248 on the 2020 Fortune 500 list of largest United States companies by revenue.[1]

In February 2020, L Brands announced the planned sale of its Victoria's Secret division to Sycamore Partners, a private equity firm. Under the agreement, Sycamore Partners would gain a 55% controlling stake in Victoria's Secret while L Brands would keep a 45% stake, leaving Bath & Body Works to become L Brand's sole business.[4] The sale fell through in May 2020, although Wexner did step down as CEO as planned, replaced by Andrew Meslow.[5]

In March 2021, L Brands announced it would spin off Victoria’s Secret as a stand-alone publicly traded company, and then change its name to Bath & Body Works, Inc.

History[edit]

Origins[edit]

Bella Cabakoff was born in Williamsburg, Brooklyn and moved to Columbus as a toddler.[6] At age 21, she became the youngest buyer for the Lazarus department store chain. After spending over 20 years working for Lazarus, in 1951, she and her husband Harry Wexner opened a women's clothing store named Leslie's (after their son) on State Street. This store became the training ground for Leslie "Les" Wexner. In 1963, he borrowed $5,000 from his aunt and $5,000 from the bank and opened a store at the Kingsdale Shopping Center in Upper Arlington, Ohio. This store was named "The Limited" because the store focused on clothing for younger women, unlike his parents' general merchandise store. Later, in 1964, Bella and Harry closed their store to join their son in his venture.[7]

1970s–present[edit]

The original board consisted of only the three family members and longtime friend Jim Waldron, who served as Senior Vice President. Bella Wexner served as secretary until her death in 2001, Harry as chairman (he served until his death in 1975), and Leslie, CEO from inception, who later succeeded his father as the chairman. As of 2014, he and his family continue to own 17% of LB. In 1969, Wexner took The Limited Brands public and sold 47,600 shares at $7.25 a share. In 1977, The Limited moved into its main headquarters on Morse Road in Columbus, from which L Brands still operates today. In 1982, The Limited was first listed on the New York Stock Exchange.[8]

L Brands shareholders filed a complaint in the Court of Chancery of Delaware on January 14, 2021, stating that former chair Les Wexner, among others, created an "entrenched culture of misogyny, bullying and harassment" and was aware of abuses being committed by accused sex trafficker Jeffrey Epstein, which breached his fiduciary duty to the company, causing devaluation of the brand. The complaint also names Wexner's wife, Abigail, current chair Sarah E. Nash, and former marketing officer Ed Razek, whose "widely known misconduct" was long allowed at the company.[9]

In February 2021, L Brands announced the retirement of CFO Stuart Burgdoerfer in August later that year. Replacing him will be current CEO of Victoria's Secret Martin Waters. Mr. Burgdoerfer stated that he is "grateful to have had the opportunity to work with extraordinary people in every part of the business."[10]

Acquisitions[edit]

The 1980s started a string of acquisitions. In 1982, the Victoria's Secret brand, store, and catalogue were purchased from Roy Raymond for $1 million.[11] Also in 1982, 207 Lane Bryant stores were purchased. In 1985, the exclusive Henri Bendel store on Fifth Avenue in New York City was purchased for $10 million and 798 Lerner stores for $297 million. Finally, in 1988, 25 Abercrombie & Fitch stores were purchased for $46 million. In 1996, The Limited ended its ownership of the A&F brand, when it was spun off into a publicly traded company.[12]

The 1990s saw the initial development of the Limited Too, Bath & Body Works, Structure, and Victoria's Secret Beauty. Later in 1998, several Bath & Body Works stores were converted to The White Barn Candle Company stores to begin a home fragrance brand.[13]

In 2005, Limited Brands purchased home fragrance manufacturer Slatkin & Company.[14]

Divestitures[edit]

On August 3, 2007, Limited Brands sold 75% ownership of its flagship Limited chain to buyout firm Sun Capital Partners, Inc. In 2010, the remaining 25% of shares were also purchased by Sun Capital. Stefan M. Selig from Bank of America was involved in these deals.[15] Following the sale of their namesake store, Limited Brands changed their company name to L Brands, as per the terms of the sale.[16] On January 7, 2017, The Limited closed all of its stores in the United States. The web retail operation, thelimited.com, was initially continued to be open for business and ship nationwide.[17] Despite this, The Limited online soon filed for bankruptcy and discontinued all services.[18] However, the brand was revived in mid-2017 by Sycamore Partners subsidiary Belk and Limited-branded merchandise is available on its website.[19]

On February 20, 2020, L Brands announced that it would sell its Victoria Secret division to Sycamore Partners, private equity firm. Under the agreement, Sycamore Partners would gain a 55% controlling stake in Victoria's Secret for about $525 million. L Brands would keep a 45% stake. leaving Bath & Body Works to potentially become L Brand's sole business. L Brands also announced that CEO Leslie Wexner was stepping down.[4] On May 4, 2020, L Brands and Sycamore Partners announced a "mutual termination" of their deal, and settlement of related litigation.[5]

At the May 14, 2020 virtual shareholders meeting, L Brands founder, CEO and board chair Les Wexner stepped down, Bath & Body Works CEO Andrew Meslow moved up to become CEO of L Brands and joined the board, and three directors stepped down. The company announced it would go forward with a spin off of Victoria's Secret as a stand alone company. It also announced it would close 250 Victoria Secret Stores and 50 Bath and Body Works stores.

On September 14, 2020, L Brands announced that it would sell its majority stake in its Victoria's Secret UK business to Next Plc under a newly formed joint venture. The financial terms of the agreement were not disclosed.[20][21]

In 2021, L Brands announced it separate Victoria’s Secret and Bath & Body Works into two separate Publicly Traded Companies. It is set to be completed in August.[22] The Current L Brands CEO Andrew Meslow will be the head of Bath & Body Works while Martin Waters will be the head of Victoria’s Secret after the split[23]

Brands[edit]

At the time of the separation, L Brands operated the following retail brands:

Former brands[edit]

Previous brands that were spun off include:

Brands that ceased operations:

References[edit]

  1. ^ a b c d e "L Brands". Fortune. 31 January 2020. Retrieved 14 June 2020.
  2. ^ a b http://www.finance.yahoo.com/quote/LB/financials?p=LB
  3. ^ a b http://www.finance.yahoo.com/quote/LB/balance-sheet?p=LB
  4. ^ a b Paramasivam, Praveen; Venugopal, Aishwarya; Herbst-Bayliss, Svea (20 February 2020). "L Brands sells majority stake in Victoria's Secret, CEO Wexner to step down". Reuters. Retrieved 21 February 2020.
  5. ^ a b Singh, Prachi (2020-05-05). "L Brands and Sycamore mutually call off Victoria's Secret deal". Fashion United. Retrieved 2020-06-07.
  6. ^ Saxon, Wolfgang (10 November 2001). "Bella C. Wexner, 93 Matriarch of Aa Retail Chain". New York. Retrieved 21 February 2020.
  7. ^ Parker, Garrett (2019-02-21). "10 Things You Didn't Know About L Brands CEO Leslie Wexner". Money Inc. Retrieved 2021-02-05.
  8. ^ "L Brands - Heritage". www.lb.com. Retrieved 25 August 2017.
  9. ^ "New Complaints About 'Culture of Misogyny' at Victoria’s Secret", by Kellie Ell, Women's Wear Daily, January 15, 2021. Retrieved January 24, 2021.
  10. ^ Sebastian, Dave (2021-02-04). "L Brands CFO to Retire After About 14 Years on the Job". Wall Street Journal. ISSN 0099-9660. Retrieved 2021-02-06.
  11. ^ "L Brands - Heritage". www.lb.com. Retrieved 25 August 2017.
  12. ^ "COMPANY NEWS; LIMITED TO SPIN OFF ITS STAKE IN ABERCROMBIE & FITCH". The New York Times. Retrieved 14 January 2015.
  13. ^ Willett, Julie A. (2010). The American Beauty Industry Encyclopedia. ABC-CLIO. ISBN 9780313359491.
  14. ^ Dash, Eric (13 May 2005). "Limited Is Said To Be Buying Home Fragrance Maker". The New York Times. Retrieved 5 December 2012.
  15. ^ Dana, Mattioli (7 November 2013). "Bank of America's Selig Nominated for Commerce Department Post". WSJ. Retrieved 14 May 2014.
  16. ^ "Limited Brands changes its name to L Brands". Reuters. New York. 22 March 2013. Retrieved 21 February 2020.
  17. ^ "The Limited shutters all of its stores nationwide". Fox 61. Fox 61. 8 January 2017. Retrieved 8 January 2017.
  18. ^ Limited. "Coming Soon - The Limited ™". www.thelimited.com. Retrieved 25 August 2017.
  19. ^ "THE LIMITED® - Official Site | belk". www.belk.com.
  20. ^ Reuters Staff (2020-09-14). "Next Plc buys majority stake in Victoria's Secret UK arm". Reuters. Retrieved 2020-09-22.
  21. ^ Rozario, Kevin. "L Brands' Deal With Fashion Retailer Next Gives Victoria's Secret A Lifeline In U.K." Forbes. Retrieved 2020-09-22.
  22. ^ Thomas, Lauren (2021-05-11). "L Brands to spin off Victoria's Secret by August, hoping to nab higher valuation". CNBC. Retrieved 2021-06-23.
  23. ^ "L Brands reveals name for spun-off Victoria's Secret". Chain Store Age. Retrieved 2021-06-25.
  24. ^ Limited Brands spins off last of its apparel stores, 2007 Associated Press/The Philadelphia Inquirer.

External links[edit]