L Brands, parent company to Victoria’s Secret, announced Thursday the sale of La Senza, its smaller intimates brand.
The price of the sale was not disclosed, but according to the agreement, which is expected to be complete in January, L Brands will transfer all assets, including ownership and operating control of all of La Senza’s North American stores, web site and international partnerships to private equity firm Regent LP. There are currently more than 120 La Senza stores in the U.S. and Canada.
In exchange, the firm will assume all of La Senza’s operating liabilities and give L Brands future potential consideration of other monetization of La Senza, as defined in the agreement.
The struggling L Brands has been looking for ways to cut costs for several months. Earlier this year it said it would shutter all 23 Henri Bendel locations, as well as the website, by January 2019. The following month, in October, the company said it would explore options for the La Senza, which the company estimated would have revenues around $250 million this year, with a $40 million operating loss. L Brands also said it would bring back swimwear to Victoria’s Secret next spring and said John Mehas of Tory Burch would take over at Victoria’s Secret early next year.
Still, company shares of L Brands, which also owns Pink and Bath & Body Works, are down more than 45 percent in the last year. In fact, last month all of the company’s growth came from its Bath & Body Works business, while the once-untouchable Victoria’s Secret continued to post declines, even as shoppers rushed out to start their holiday shopping.
California-based Regent would not respond to a request for comment. The equity firm has a number of investments in technology, media and retail companies including Sassoon, Sunset Magazine and Lillian Vernon, among others.
L Brands’ stock was down more than half a percentage point after the announcement at the start of Thursday’s trading session. The company declined to comment.