A private equity firm had agreed to purchase the women intimates brand, Victoria's Secret prior to the COVID-19 pandemic are now trying to terminate their agreement.
Sycamore Partners has filed a lawsuit asking the judge to terminate the deal. Victoria's Secret, owned by L Brands, has announced that they will fight this lawsuit.
Victoria's Secret had been struggling prior to COVID-19, but now, with all their physical and online stores being temporarily shut, they have taken an incredible financial hit.
Sycamore Partners claims that the temporary shutdown of Victoria's Secret was "voluntary" and thus, has "caused significant damage to the Victoria's Secret business."
L Brands has stated that the termination of the transaction agreement is invalid and will continue working toward closing the transactions.
Victoria's Secret was in trouble before the pandemic, as with many chain retailers. As a result, they have already borrowed $950 million from a revolving credit facility in March and has postponed employee raises, has temporarily reduced base pay for senior-level staff by 20 per cent and much more.