Victoria’s Secret is the latest company to take a huge hit because of the pandemic. According to CNN, the retail company will be closing 250 Victoria’s Secret stores in the United States and Canada.
The news was announced by L Brands. Apparently, Victoria’s Secrets lost 37% of its nets sales during the first quarter, with most of the stores closed due to the coronavirus pandemic. As Forbes notes, there are currently 1,091 Victoria’s Secret stores in the U.S. and Canada.
Initially, the plan was to sell Victoria’s Secret to a private equity firm but it was mutually terminated on Monday after the buyer, Sycamore Partners, tried to back out of the deal because it said it did not like the steps the lingerie brand took in response to the COVID-19 pandemic. L Brands, which also owns Bath & Body Works, had agreed in February to sell a majority of Victoria’s Secret to Sycamore Partners for about $525 million but it didn’t go as planned.
In a statement on Monday, Sarah Nash, a director at L Brands and the company’s incoming chairwoman, explained that it was an “extremely challenging business environment” for retailers as part of its decision to put end to the deal.
“Our board believes that it is in the best interests of the company, our stockholders and our associates to focus our efforts entirely on navigating this environment to address those challenges and positioning our brands for success rather than engaging in costly and distracting litigation to force a partnership with Sycamore,” Ms. Nash said.
The retailer announced that it is still interested in “establishing Bath & Body Works as a pure-play public company” and it hopes to prepare its Victoria’s Secret businesses to operate as a standalone company.