Limited Brands declares next steps in ongoing plan
23 Jun '07
3 min read
No headcount reductions are anticipated in stores, distribution centers or call centers. The current corporate and brand home office employment is approximately 5,300 associates. Savings will also be realized through a reduction of other operating expenses.
One-time costs and the specific impact on 2007 financial results will be provided at a future date once specific plans are finalized.
The company is increasing the previously announced $500 million share repurchase program to $1 billion. Under this program, the company has repurchased $190.5 million worth of shares and intends to accelerate the rate of repurchases. The specific timing, amount and method of repurchases will vary based on market conditions and other factors.
The company intends to raise $1.25 billion of debt to fund these share repurchases, the recent acquisition of La Senza and other general corporate requirements.
Limited Brands had previously announced that it had signed a definitive agreement with affiliates of Golden Gate Capital to sell a 67 percent ownership interest in its Express brand for pre-tax cash proceeds of $548 million. Subject to customary closing conditions, the transaction is expected to close on July 6, 2007.
The Department of Justice has granted early termination of the waiting period applicable to the acquisition of an ownership interest in Express under the Hart-Scott-Rodino Antitrust Improvements Act of 1976.
The company continues to explore strategic alternatives for its Limited Stores business. No timetable has been established for completion of the Limited Stores process.
The company is also evaluating the feasibility of alternatives involving certain other non-core assets, including real estate and other investments. The company is not considering alternatives for Mast Industries Inc, which is strategic to the sourcing and production of merchandise for Victoria's Secret, Pink and La Senza.
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