Unlike the leveraged buyouts common in the 1980s, when Cersei Capital acquired LTD, it had no plans to quickly break the company up and sell the pieces for a fast cash-out. Instead, it preferred to operate the business long-term before pursuing a secondary public listing.
Therefore, in terms of funding, Cersei Capital could not adopt the short-term high-interest borrowing and junk bond financing models that were typical in the 1980s.
To raise the funds needed for the LTD acquisition, even before the formal acquisition actions began, Cersei Capital had already started preparing to issue a brand-new fund dedicated specifically to this deal.
Once the acquisition transaction was completed, Cersei Capital had also essentially finished raising capital for this fund.
An acquisition exceeding two billion dollars, although far from comparable to the Reynolds Nabisco deal with its total transaction value of 33 billion dollars, against the backdrop of the United States still not fully recovered from the bond market crash of a few years earlier, this deal was already the largest private equity acquisition by value in the past two years.
To give investors confidence, and also out of consideration for the Westeros system's own investment strategy, shortly after the deal closed, Westeros Corporation quickly announced that it would purchase 10 percent of LTD's shares at the negotiated price. Subtracting the additional 10 percent stake retained by the Wexner family, Cersei Capital had in fact acquired only 80 percent of LTD's equity, requiring a payment of 1.96 billion dollars.
Westeros Corporation's direct participation allowed the investors who had previously signed letters of intent to quickly fulfill their fund subscription commitments. This ensured the acquisition proceeded smoothly to completion.
The specific acquisition process would still take two months to finalize, yet Simon quickly made contact with LTD founder Leslie Wexner.
Leslie Wexner's story of building his fortune was quite typical for this industry.
He had started with a single fashion store, then spent the next twenty years steadily expanding the chain until it became the current LTD company with thousands of stores in total.
What Simon cared about most, Victoria's Secret, was actually a lingerie chain brand that Leslie Wexner had purchased from another businessman back in 1982.
Because it was not the foundational business, even though Victoria's Secret had developed extremely rapidly over the years and later mentions of LTD would make people think only of Victoria's Secret, at this moment Leslie Wexner still treated the women's fashion and activewear sub-brands under LTD as the core of operations.
Therefore, compared to the later period when Victoria's Secret alone accounted for over 60 percent of the parent company's sales, in 1991 Victoria's Secret currently held only a little over 20 percent of LTD's total sales share.
The economic downturn, overexpansion, and abandoning the original Limited Brands operating strategy in an unrestrained pursuit of more fields had ultimately led LTD into operational difficulties after the U.S. bond market collapse.
Speaking of which, LTD founder Leslie Wexner was a very aggressive businessman. This was actually quite similar to the impression Simon gave to the outside world.
The Westeros system had risen like a miracle in just six short years. Many of Simon's bold and risky moves during this process could not even be simply described as aggressive.
However, having lived two lives, Simon had always been very clear about what he was doing.
Many of Westeros Corporation's layouts that outsiders found incomprehensible, such as the almost insane level of investment in Ygritte Company over the past two years, were for Simon simply about securing early positions in industries that were destined to explode.
Leslie Wexner, however, could not possibly possess Simon's advantage of foresight.
Over the past twenty years, LTD's continuous expansion had been mostly just the natural actions of a risk-taking businessman.
The fashion sector had long become a highly competitive red ocean market.
LTD's continued overexpansion had therefore fallen into the homogenization problems that many fashion companies could not avoid. After all, the fashion industry was ultimately very difficult to produce too many new innovations in.
Serious product homogenization, an overly bloated corporate structure, and rising relative costs inevitably caused a decline in brand competitiveness.
In recent years, sales of LTD's women's fashion and activewear lines had continued to decline along with the sluggish economy. The only segment bucking the trend and rising was Victoria's Secret, which focused exclusively on lingerie.
Simon privately wondered if this was the legendary lipstick effect.
However, in the original timeline, LTD had begun shifting more attention toward operating Victoria's Secret starting in the 1990s, returning to the Limited Brands strategy of focusing on core brands. This was probably inspired by Victoria's Secret's strong market performance in the early nineties.
LTD's headquarters was located in Columbus, Ohio.
Ohio sits in the northeastern United States, bordering Pennsylvania to the east and touching the Great Lakes to the north. Unlike the winding, mountainous western states, Ohio lies in the vast eastern plains region. As the state capital, Columbus sits right in the center of this plain.
After returning from Australia, Simon and Janet soon accepted Leslie Wexner's invitation and came to Columbus, Ohio, as guests.
Of course, there were some other reasons for this as well.
The butterfly effect Simon had created in this world was becoming increasingly obvious, yet it had not prevented events from happening.
For example, the major Los Angeles riots at the end of April 1992.
The incident stemmed from March 1991, when a black youth named Rodney King was violently handled by Los Angeles police officers for drunk driving, resisting arrest, and other behaviors. A passerby recorded the event on videotape and sold it to a television station. As a result, the major networks, accustomed to manufacturing topics, edited out the first half of the tape showing Rodney King's various acts of resistance, leaving only the footage of him being beaten to air on television.
On April 28, the Los Angeles court ruled the four involved officers not guilty based on the complete records of the incident. This triggered dissatisfaction among the black community and led to large-scale riots.
Although in his memory the riots had only occurred in south-central Los Angeles, who knew whether there would be any abnormal changes this time.
The moment the incident broke out, Simon quietly left Los Angeles and met up with Janet, who had rushed over from New York, in Columbus.
Out of habit, he had already prepared a 50-acre farm-style estate here in Columbus beforehand.
Unlike Los Angeles and other coastal cities that experienced successive riots, Columbus, located in the central plains, appeared exceptionally calm.
This was not without reason. Situated in the more conservative northeastern United States, Ohio had a far lower proportion of people of color than the East and West Coast states. In this era, the white population proportion was still over 90 percent.
Simon did not have many feelings about this riot. This country had experienced such events before.
Inside the farm estate in the northern suburbs of Columbus, Leslie Wexner also had no intention of discussing this sensitive topic.
For politicians, this matter was wrong no matter which side they leaned toward. That was why President Bush had only stepped forward two days after the riots began to make some vague, half-hearted appeals. Being an election year, all the candidates were unusually tight-lipped about the incident.
It was all about the votes!
Both Simon and Leslie Wexner were public figures. Even without the various concerns professional politicians had, saying too much would only lead to more mistakes.
Although he clearly understood that a country sliding toward extreme political correctness was often the bitter result of such continuous silence and concessions, Simon had no intention of trying to change anything.
A deep-rooted pessimism in his bones made him more accustomed to observing too many things with cool detachment.
They could not talk much about politics, so of course they talked business.
Today was May 1, and without realizing it, late spring had already turned into early summer.
Strolling along the vibrant farm paths, ignoring the disturbances outside, his mood unconsciously became very relaxed and pleasant.
During these few days in Columbus, Simon had been continuously discussing LTD's next steps for development with Leslie Wexner.
LTD's difficulties in recent years had already proven that the company needed to make changes.
In the original timeline, LTD had abandoned many peripheral brands and focused operations on Victoria's Secret. That had been the result of such a change.
However, combining the information from his memories, Simon realized that LTD could actually attempt another approach.
Since the sexy marketing method through Victoria's Secret fashion shows had already proven extremely successful, that promotion strategy for the Victoria's Secret brand would naturally be retained. But for LTD's women's fashion and activewear businesses, Simon also proposed to Leslie Wexner a concept that had been gradually taking shape in recent years but had not yet grown into its full potential: fast fashion.
Many years later, the world's most famous affordable fashion brands, such as Zara, H&M and GAP, all operated on the fast fashion model.
Simply put, fast fashion meant taking the popular trends showcased at major fashion weeks and rapidly bringing them into more affordable consumer segments in an extremely short time.
First-class design, second-class branding, third-class pricing. This was a very vivid summary of fast fashion brands.
To put it more bluntly, so-called fast fashion was essentially the rapid copying and imitation of fashion trends created by top luxury brands.
In Simon's memory, the Spanish Zara brand was sued again and again for copying designs, paying out tens of millions of dollars in infringement fees every year. Yet the company never showed any intention of reforming itself and continued diligently sending its massive team of designers to major fashion shows.
Compared to the enormous profits, those annual infringement costs of tens of millions of euros were truly negligible.
Zara's owner, Amancio Ortega, had once relied on this world-class fast fashion brand to surpass Warren Buffett and enter the top three on the global rich list with a net worth of tens of billions of dollars.
Whether it was Spain's Zara, Sweden's H&M, or America's GAP, the three major fashion giants of the future had all already been established by this time. However, all three companies still had a long road ahead before reaching their peak. LTD already possessed a very deep foundation in the fashion sector. Transforming toward fast fashion before the three giants rose was not late at all.
Once affordable fashion chains developed to a certain scale, achieving the next breakthrough had always been a long-standing problem for Leslie Wexner.
Unlike luxury brands, affordable fashion was simply too prone to homogenization. The biggest issue was the difficulty of maintaining a distinct brand identity over long periods. Large-scale marketing alone could not solve this problem.
The fast fashion concept Simon had proposed over the past few days gave Leslie Wexner a sudden sense of enlightenment.
Since they could not maintain a certain fashion brand identity long enough to attract consumers, they might as well do the opposite and constantly chase the newest and fastest trends.
As for the moral risks involved, such as copying and imitation, for a businessman who had been navigating the commercial world for decades, there was no psychological burden whatsoever.
After several days of discussion, Leslie Wexner accepted Simon's suggestion.
In the next phase, while focusing on promoting the Victoria's Secret brand, LTD planned to integrate its fashion businesses. Using the foundation of one of LTD's earliest brands, called Express, they would build a fast fashion brand.
In addition, LTD would sell off some non-core operations. This sale would of course not be the kind of breakup sale that followed 1980s leveraged buyouts.
The funds obtained from these asset sales would be used entirely to develop the two major brands: VS and Express.
"Simon, I thought carefully again last night about the lingerie fashion show concept you mentioned yesterday. It's a really excellent idea. However, according to your vision of inviting the top models in the fashion world and doing a television broadcast, the budget seems rather high. Perhaps we can start a bit simpler at the beginning."
"I have also considered the budget issue," Simon said with a smile. "Les, how about this: the big show will be co-produced by Daenerys Entertainment and LTD, with each side taking on 50 percent of the budget. Daenerys Entertainment will handle distribution through television platforms, videotapes, and other channels."
Strolling along the lush green farm roads, the scenery was pleasant yet the person remained sober.
Leslie Wexner quickly began calculating in his mind.
Simon had done his research on both LTD and Leslie Wexner. Similarly, after their interests intersected, Leslie Wexner had also carefully studied this young man's path to success.
Daenerys Entertainment had managed to sell a Gucci brand documentary for tens of millions in box office revenue, made Madonna's concert documentary a major hit, and turned an Antarctic scenery documentary into a box office dark horse. So it was hard to say whether this lingerie fashion show might not hold similar value.
Thinking along these lines, Leslie Wexner soon asked, "Simon, since we're sharing the budget, the profits should also be shared, right?"
Simon glanced at the man in his fifties beside him and replied, "Les, LTD only needs to contribute half the budget to gain massive promotion for the Victoria's Secret brand. Isn't that enough?"
"But we are still bearing half of the production costs."
Leslie Wexner hesitated for a moment but ultimately did not agree to let LTD cover the entire production budget.
According to the vision laid out by the young man beside him, such a grand show would fundamentally require tens of millions of dollars in funding.
Investing over ten million dollars at once for a single fashion runway show was quite a risky move.
Moreover, the issue seemed to go beyond just money.
This project would definitely require Simon's personal planning, including inviting those top supermodels. Without Simon making the arrangements, it would be difficult to pull off.
Although Victoria's Secret itself had solid performance and recognition, it was ultimately just an affordable lingerie brand.
For many supermodels, walking for such a brand would somewhat lower their status.
If they had to share the stage crowded together with other models, it would lower their status even more.
However, if it was a project orchestrated by Simon Westeros, they would probably find it much easier to accept.
Leslie Wexner was also aware of the two so-called waist fairies and leg fairies who had suddenly risen in the fashion circle last year.
Westeros had created two rapidly rising supermodels with just a single playful venture.
With this young man's powerful influence in Hollywood and the fashion world, he could absolutely and easily assemble a superstar supermodel team for Victoria's Secret.
This was something the current LTD simply could not achieve.
In the original timeline, Victoria's Secret's lingerie shows had first begun in 1995.
However, unlike the increasingly spectacular scale they reached after the new century, the earliest shows could only invite one or two quasi-top models as headliners. It was not until a decade later that the Victoria's Secret show finally reached its peak with a gathering of goddesses.