Staples owner drops $525M plan to buy Victoria's Secret

Photo | Grant Welker The Framingham headquarters of office supply retailer Staples

Write a Comment

By Grant Welker

A planned purchase of Victoria's Secret by Staples owner Sycamore Partners is off, leaving the women's clothing brand to plan to operate as a standalone entity apart from Bath & Body Works.

Sycamore, a private equity firm that bought Framingham's Staples in 2017 for $6.9 billion, had an agreement to buy L Brands of Columbus, Ohio, in February for $525 million, according to The New York Times. A deal was expected to close in the second quarter, The Times said.

But L Brands said Monday the two sides were calling off their deal. They agreed to settle all pending litigation and mutually release all claims, the Ohio company said.

L Brands said it would instead plan to establish Bath & Body Works as a public company and prepare Victoria's Secret to operate as a standalone separate company. Sarah Nash, an L Brands director, said in a statement the board wanted to focus on those efforts instead of what she called costly and distracting litigation with Sycamore.

Sycamore said in late April it wanted to terminate the deal because Victoria's Secret breached the terms of its agreement in closing stores and furloughing workers because of the coronavirus outbreak, The Wall Street Journal reported.

Sycamore, which is based in New York, owns a range of other retailers including The Limited, Belk, Coldwater Creek, Talbots and Hot Topic.

Under Sycamore, Staples paid $500 million for the Illinois wholesale office supplier Essendant in a deal closed in early 2019. In February, Staples sold its longtime headquarters for $165 million to LCN Capital Partners, a New York firm specializing in sale-leaseback deals.