Leslie Wexner is about to have some new faces in the L Brands Inc. boardroom.
The Victoria’s Secret parent reached a deal with activist investor Barington Capital Group to bring in two board members and to serve as a “special adviser” to the company.
Wexner founded L Brands in 1963 and built the company into a retailing powerhouse, which he still leads as chairman and chief executive officer. But the Victoria’s Secret brand has hit a rough patch with several changes of direction and management exasperating sales declines, while Bath & Body Works, its sister division, goes from strength to strength.
Shares of L Brands are down 28.8 percent over the past year and closed at $25.68 Thursday.
Last month, Barington, which is led by chairman and ceo James Mitarotonda, starting pushing for changes, potentially even the separation of the businesses.
Late on Thursday just before the Good Friday market holiday, L Brands nominated four directors, including incumbent directors Wexner and Patricia Bellinger as well as two fresh faces, Anne Sheehan and Sarah Nash. Sheehan is chair of the Securities and Exchange Commission’s investor advisory committee and Nash spent nearly 30 years at J.P. Morgan Chase, rising to vice chairman of global investment banking.
If the slate of directors is elected at the company’s annual meeting, more than 40 percent of the board will be women.
L Brands also committed to recommend that stockholders vote in favor of proposals to declassify the firm’s board so that all directors stand for election in 2021.
Allan Tessler, lead independent director and chair of the board’s nominating and governance committee, said: “We are pleased to nominate Anne and Sarah as new independent directors and believe the addition of fresh perspectives to our board will be beneficial to L Brands, its businesses and the actions under way to improve performance and support our growth. Anne and Sarah bring governance and financial expertise and public company board experience that will be invaluable to the board and management team.”
Under the agreement between L Brands and Barington, the activist agreed to vote in favor of the new nominees.
“We are pleased to have reached this collaborative agreement with the L Brands board and management team,” said Barington’s Mitarotonda. “We are aligned in our belief that there are significant opportunities to continue to drive improved financial results, and look forward to working closely with the company and the board toward our shared goal of enhancing long-term stockholder value.”
Wexner’s comment in the company’s release was terse: “L Brands is committed to creating long-term value for all L Brands stockholders by delivering growth, strengthening our financial performance and building on our leading market positions. We will continue to take actions that we believe will enable us to achieve these important objectives.”