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A woman walks past a Victoria’s Secret store in Midtown Manhattan, March 1, 2019 in New York City.
An investor in Victoria’s Secret parent L Brands is asking the company to consider splitting fragrance and personal care shop Bath & Body Works from the lingerie chain, according to the Wall Street Journal.
The hedge fund, which has a small stake in L Brands, sent the letter to L Bands Chairman and CEO Leslie Wexner on Tuesday. It’s shares were trading up by more than 4 percent before the markets opened Tuesday.
In the letter, Barington Capital argues that improved merchandising and fresh branding would help the struggling Victoria’s Secret brand, according to a copy of the letter seen by the Journal. The hedge fund says Victoria’s Secret was late to the athleisure trend and missed the mark on consumer sentiment.
“Victoria’s Secret’s brand image is starting to appear to many as being outdated and even a bit ‘tone deaf’ by failing to be aligned with women’s evolving attitudes towards beauty, diversity and inclusion,” Barington writes in the letter.
L Brands said last month it plans to close roughly 53 Victoria’s Secret stores in 2019. Comparable store sales for Bath & Body Works, known for its scented lotions and candles, rose 12 percent in the fourth quarter of 2018.
Barington also asks L Brands to make changes to its directors to improve the independence and diversity of its board, according to the Journal.
Barington did not immediately respond to CNBC’s request for comment.
Read the full report in the Wall Street Journal.
