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Investing.com -- Bath & Body Works Inc. (NYSE:BBWI) shares advanced 2.3% in extended trading Thursday following reports that activist investor Barington Capital Group has built a fresh position in the specialty retailer and is urging its board to explore a strategic sale. Barington Chief Executive Officer James Mitarotonda disclosed a stake of approximately one million shares in an interview with Bloomberg, signaling a renewed intervention at the Columbus, Ohio-based company he previously targeted in 2019 under its former corporate identity, L Brands.
The activist firm contends that persistent leadership turnover has severely depressed the retailer's valuation despite its durable brand equity and strong cash flow generation. Mitarotonda emphasized that the personal-care chain should immediately retain financial advisers to initiate a sale process, expressing confidence that its market-leading position would attract significant interest from private equity suitors.
Beyond a potential sale, Barington is calling on the company to deploy its balance sheet strength toward aggressive share repurchases to restore shareholder value. The activist investor plans to formalize its demands in a forthcoming letter to the board and is evaluating a potential proxy contest for board representation, according to the Bloomberg report.
In response, a spokesperson for Bath & Body Works told Bloomberg that the company regularly engages with investors and remains committed to evaluating all avenues to enhance shareholder value in the best long-term interests of the business. Management reaffirmed its dedication to executing its operational strategy while maintaining an open dialogue with its broader investor base.