Lingerie retailer Victoria’s Secret is taking out a $500 million loan to finance its split from Bath & Body Works.The loan is due 2028 and could pay interest that’s 300 to 325 basis points above Libor. JPMorgan Chase is overseeing the sale, with investor orders due by June 30, the report said.The report comes after parent company L Brands announced the spin-off last month that would separate the two brands into independent, publicly traded companies by August. Representatives for Victoria’s Secret, Bath & Body Works, L Brands and JPMorgan Chase did not immediately respond.
Last month, L Brands reported quarterly numbers that beat analyst expectations. The company said its results were driven by more customers paying full price for products and strong momentum across its different divisions. L Brands stock has rallied 68.8% for the year to date while the benchmark S&P 500 index SPX is up nearly 11% for the period.
Andrew Meslow, Chief Executive Officer of L Brands said that today’s filing is an important step toward creating two independent, public companies designed to thrive in an evolving retail environment. They believe Victoria’s Secret and Bath & Body Works will achieve new levels of success and unlock significant value for all stakeholders by pursuing growth strategies best suited to each company’s customer base and strategic objectives.