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Deals come undone

The investment firm that agreed to buy Victoria’s Secret in February wants to back out, the highest-profile example to date of a buyer trying to unpick a deal because of the pandemic.

Sycamore Partners asked a Delaware court to let it walk away. Its reason: The seller, L Brands, had furloughed most Victoria’s Secret employees, cut executive salaries and missed April rent payments. That veered from the “ordinary course” of business required in the takeover agreement.

• Though the pandemic “is an international tragedy and health emergency,” says Stefan Kaluzny, Sycamore’s founder and C.E.O., “we are equally certain that it does not excuse the performance of L Brands’ obligations.”

This could become a popular get-out, the Deal Professor, Steven Davidoff Solomon, explained in DealBook earlier this month. The auto parts maker BorgWarner warned it might try a version over its deal for Delphi.