THE WHAT? Activist investor Barington Capital has taken a new stake in Bath & Body Works and is urging the personal care and fragrance retailer to explore a potential sale of the business.
THE DETAILS Barington has acquired more than one million Bath & Body Works shares and argues that the company is undervalued following years of management changes and weakening financial performance. The investor wants the retailer to appoint advisers to explore a sale, which it believes could attract significant private equity interest, while also calling for share buybacks and considering seeking board representation. Bath & Body Works operates around 1,900 stores across the US and Canada and approximately 550 internationally. Its shares have fallen around 78 percent since the former L Brands separated Victoria’s Secret and renamed itself Bath & Body Works in 2021, while net income has declined by approximately 50 percent.
THE WHY? Barington’s intervention increases pressure on Bath & Body Works to accelerate its turnaround or consider a strategic transaction, potentially putting one of the largest specialist fragrance and personal care retailers in play for private equity or another buyer.
Source: Bloomberg
