L Brands, the owner of Victoria’s Secret, is reportedly on the hunt for a new buyer after a deal with a private-equity firm fell through last year, and is seeking more than double what it wanted before.
Sources familiar with the matter told Bloomberg wanted a deal that would value the brand at between $2 billion and $3 billion. Previously, Sycamore Partners had agreed to buy a 55% stake in the company for $525 million.
A spokesperson for L Brands did not immediately respond to Insider’s request for comment on Friday morning. L Brands CFO Stuart Burgdoerfer confirmed to Bloomberg that the company wanted a considerably higher valuation this time round, after recouping lost sales at the back end of 2020.
“As a result of the substantial improvement in performance at Victoria’s Secret, various sell-side analysts have valued the business at as much as $5 billion,” Burgdoerfer told Bloomberg.
After several years of sliding sales, the Victoria’s Secret brand has made a comeback in recent quarters after reshuffling management and changing its brand image and marketing, which was accused of being outdated. In a recent note to clients, a group of Jefferies analysts described the brand’s progress as “admirable,” after it reported strong fourth-quarter results.
In March this year, former longtime L Brands CEO Les Wexner stepped down from the board after pressure from investors.
Investment giant Apollo Global Management is offering six-figure retention bonuses to some of its private-equity associates after several young executives quit the firm, Insider has learned.
Seven out of 30 New York City associates have left the firm in recent weeks, Insider previously reported. Current and former employees who spoke with Insider about the exodus described a relentless workload that has become even more intense during the pandemic as the firm – well-known for its distressed buying strategies – pounced on opportunities.
In an effort to stem the exits, Apollo has extended $100,000, $150,000, and $200,000 bonuses for first-year, second year, and third-year associates, respectively, to be paid in April, according to two people familiar with the matter. The bonuses come with the stipulation that associates stay with Apollo at least until September 2022.
And they come on top of pay packages that are already at the top of the market: First-year associates at Apollo receive a total of more than $450,000, according to these people, who declined to speak publicly to preserve their relationships at the firm.
Apollo executives Matt Nord and David Sambur, who co-lead the firm’s private equity group, have been making the offers to employees via phone calls, according to these sources.
Insider could not determine how widespread the bonuses were. One Apollo employee said several associates they had spoken with had not received the bonuses, meaning that the bonuses could have been offered to a select group of associates.
It could also mean that Apollo is in the early stages of rolling out the bonuses.
Joanna Rose, an Apollo spokeswoman, did not address the specific bonuses when asked, but said that the firm’s private-equity business has been and continues to be “extremely active,” putting more than $12 billion to work in the past year across a “diverse set of opportunities.”
“With recent wins such as Sun Country IPO, Diamond/HGV merger and Synnex/TechData merger, we continue to recognize the impact of our extraordinary teams,” she said.
The offers show how far one of the largest investment firms is willing to go to deal with a talent drain among its junior employees, who have grappled with burnout fueled by long-hours and remote work.
They come as concerns about associate morale have cropped up at financial services firms across Wall Street. Last week an internal presentation by 13 demoralized Goldman Sachs analysts described 100-hour work weeks and a mental and physical toll during COVID.
Firms have been taking steps to address the concerns, though no action has been as extreme as Apollo’s. Jefferies has offered Peloton bikes and other workout gear for junior staffers, while Goldman Sachs has vowed to improve conditions for junior bankers, though it has not yet said how.
The additional compensation will make associate jobs at Apollo – already one of the highest-paying entry points on Wall Street – even more lucrative. The typical starting salary of $450,000 for first-years comes with subsequent $100,000 raises annually; third-years can earn up to $725,000, according to these people.
The position offers a four-year career track to principal and, from there, partner – a position that typically earns millions of dollars annually.
Young executives are key to the private-equity group’s success, handling the grunt work of preparing presentations and analyses that higher executives use to evaluate and pursue deals.
The group has been active in recent months, buying a $1.2 billion stake with Silver Lake Partners in the travel website Expedia and a $1.75 billion interest in the grocery-store operator Albertsons. It also recently completed a $2.25 billion deal to control and operate the Venetian resort and casino on the Las Vegas Strip.
Apollo’s new CEO, Marc Rowan, has signaled that he prioritizes making Apollo a more enticing place to work. Rowan has said in recent weeks that one of his primary areas of focus will be to improve Apollo’s famously ruthless culture.
Apollo had previously stated that Rowan, a co-founder at the firm who is credited with building its expansive insurance business, would take over the chief executive role from Leon Black, the company’s chief founder, who would relinquish the role by his 70th birthday in July.
In a surprise announcement on Monday, the firm stated that Black would step down immediately and also vacate his role as chairman of Apollo’s board, a position he had previously intended to keep. The firm’s announcement cited health issues as a reason for Black’s change of plans.
Black’s departure followed revelations in an investigation commissioned by Apollo and released at the beginning of the year that he had paid the convicted pedophile, Jeffrey Epstein, $158 million for tax and business services.
Legends Hospitality – the company best known for its luxury suites found at sports and entertainment venues – announced on Tuesday a majority investment from Sixth Street, a global investment firm with over $50 billion in assets under management.
Founded in 2008 by Jerry Jones, owner of the Dallas Cowboys, and Hal Steinbrenner, owner of the New York Yankees, Legends partners with sports stadiums, event venues, and universities to provide a variety of hospitality management services. Its offerings include planning, sales, partnerships, merchandise, tech, and hospitality services.
The Wall Street Journal reported Monday, ahead of the announcement, that Sixth Street was expected to value Legends at $1.3 billion – a marked increase from the $700 million valuation it received in 2017, according to Pitchbook.
The investment comes off the back of a difficult 2020 for the live sports and entertainment industry due to the COVID-19 pandemic. The majority of live events occurred with either limited or no spectators.
“While this has been a challenging year for the sports and live entertainment industry, we passed the test and are now positioned for stronger, even more resilient growth,” Shervin Mirhashemi, president and CEO of Legends, said in a statement announcing the news.
Sixth Street is not Legends’ first investment partner
Sixth Street is not the first investor to back Legends.
Goldman Sachs served as a founding investor via what was formerly known as its merchant banking division, but exited its position in 2012, according to Reuters.
The Yankees’ Steinbrenner, cited the importance of Legends’ previous investors throughout its growth.
“Since its founding, Legends has benefited from a series of committed investment partners, each critical to a particular stage of development,” he said in a statement.
Despite COVID-19 challenges, Legends is staying optimistic
While the limiting of spectators to live events has certainly impacted Legends business, it’s also explored other avenues. What started as a focus on sports stadiums has expanded into new channels and partnerships across the globe.
As Legends has grown its suite of offerings, it has also expanded its repertoire of clients, partnering with the One World Observatory, Live Nation, SoFi Stadium, University of Notre Dame, and international soccer club Real Madrid.
Making inroads in the attractions space, Legends partners with its clients to offer panoramic views of New York, Seattle, and London from the cities’ tallest buildings.