L Brands Inc (LB.N) filed a legal complaint against Sycamore Partners on Thursday, after the buyout firm walked away from a $525 million deal to acquire a majority stake in the company’s Victoria’s Secret lingerie brand.
The filing in a Delaware court sets up the first high-profile U.S. legal fight over the termination of a merger agreement because of the COVID-19 pandemic.
Sycamore said on Wednesday the worldwide closure of nearly all 1,600 Victoria’s Secret and PINK stores, including more than a thousand stores in North America, in response to the coronavirus outbreak occurred without its permission and had breached the terms of the deal.
However, L Brands said the agreement was still valid as it was transparent with Sycamore on the steps it was taking to “protect the Victoria’s Secret business”.
The company said Sycamore tried to renegotiate the purchase price of the 55% stake, before sending a termination notice.