Limited Seeks to Buy Remaining 16% Of Intimate Brands in Plan to Reunite
Limited Inc., reversing a seven-year-old decision to separate Intimate Brands Inc., said it is offering nearly $1.5 billion in stock to buy back the 16% it doesn't already own in the company.</br></br>Limited, based in Columbus, Ohio, offered part of Intimate Brands, parent of Victoria's Secret and Bath & Body Works, to the public in 1995 in a move designed to highlight the value of the businesses. At the time, Intimate Brands accounted for 70% of Limited's operating income but less than 60% of the company's stock-market valuation. Today, the two measures are more in line. Limited gets more than 90% of its operating income from Intimate Brands and about 95% of its market capitalization.</br></br>"The most significant factor in the Board's decision to take this action is the belief that a recombination of the businesses at this point will allow us to achieve greater growth," Leslie Wexner, chief executive of both companies, said in a statement. "This clearer, simpler structure will allow us to fully develop the potential of our best brands across merchandise categories and distribution channels."</br></br>Under terms of the proposal, Limited is offering 1.046 Limited shares for each Class A share of Intimate Brands. In 4 p.m. composite trading on the New York Stock Exchange, shares of Limited were down 70 cents at $17.75, while Intimate Brands slipped 40 cents to $17.50. The exchange offer values Intimate Brands at $18.57 a share, only a 6.1% premium to Intimate's current trading price. Intimate Brands hit a 52-week-high of $19 about one year ago today.</br></br>The stock price of Limited, whose brands include Limited stores, Express, Structure and Lerner New York, closely tracks that of Intimate Brands.