Long-time L Brands CEO and chairman Les Wexner has stepped down after being at the helm for nearly 60 years. The move also comes at a time when the company has sold its majority stake in Victoria’s Secret.
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L Brands announced that Sycamore Partners, a private equity firm, will get a 55% stake in Victoria’s Secret, valued at $1.1 billion. L Brands will still have a 45% stake in the company.
What’s more, sister brand Bath & Body Works will continue as a standalone company.
Les Wexner is the longest-standing CEO among all Fortune 500 companies, having founded L Brands in 1963. While Wexner has stepped down as CEO, he will still have a seat on the board of directors as chairman emeritus.
The current COO of Bath & Body Works, Andrew Meslow, will take over at the head of L Brands.
Wexner said in a press statement:
We believe the separation of Victoria’s Secret Lingerie, Victoria’s Secret Beauty and PINK into a privately held company provides the best path to restoring these businesses to their historic levels of profitability and growth.
Sycamore, which has deep experience in the retail industry and a superior track record of success, will bring a fresh perspective and greater focus to the business. We believe that, as a private company, Victoria’s Secret will be better able to focus on longer-term results.
We are pleased that, by retaining a significant ownership stake, our shareholders will have the ability to meaningfully participate in the upside potential of these iconic brands.
Although Victoria’s Secret still remains the biggest lingerie retailer in the US, it has been steadily losing market share while its oversexualized ads and racy runway shows have seemingly failed to entice shoppers in the era of #MeToo.
It didn’t help that Ed Razek, chief marketing officer at L Brands and one of its longest-standing executives after Wexner, went viral in November when he told Vogue that the annual Victoria’s Secret fashion show shouldn’t feature “transsexuals” because of the “fantasy” theme of the show.
“It’s a 42-minute entertainment special. That’s what it is,” he said in the interview.
The ensuing outcry forced Razek to issue a formal apology with him stepping down from the company in August.
Wexner’s relationship with Jeffrey Epstein, who was accused of sex trafficking of minors, likely fueled Wexner’s exit. Epstein used to manage Wexner’s money and the two were reportedly close.
The board of directors of L Brands had an outside law firm review the company’s relationship with Epstein. Wexner even addressed his relationship with Epstein at an L Brands investor meeting in September.
“At some point in your life we are all betrayed by friends,” Wexner said. “Being taken advantage of by someone who was so sick, so cunning, so depraved, is something that I’m embarrassed I was even close to. But that is in the past.”
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