Dive Brief:

• Apparel retailer The Limited has hired Guggenheim Partners as financial adviser to explore a possible sale or restructuring, sources have told The Wall Street Journal.

• Potential suitors could include rival retailers or private equity firms, according to the report, which did not specify interested companies.

• Former parent L Brands (owner of Victoria’s Secret and Bath & Body Works) sold a 75% stake in The Limited to private equity firm Sun Capital in 2007; three years later, Sun acquired the remaining 25% stake.

Dive Insight:

Mall-based apparel retailers like The Limited, which has 243 stores across the country, have found it especially difficult to entice customers in recent years, given that malls are also struggling to get people through the doors.

As online sales of apparel continue to rise, pressure on malls to revive or shutter is increasing. The U.S. currently has about 1,100 enclosed malls, but Jan Rogers Kniffen, CEO of J. Rogers Kniffen Worldwide Enterprises, said earlier this year that number should be closer to 700. 

A waning interest in malls has also hurt the likes of American Apparel (which recently filed for its second bankruptcy in little over a year), Ann Inc. stores (which was recently bought by Ascena) and Wet Seal (which emerged from bankruptcy last year). Fast fashion has taken a bite out of many of these retailers, with lower prices and more nimble supply chains that ensure up-to-the-minute styles, while rivals allow rejected merchandise to languish on racks.

While Sun Capital touts The Limited as a place to buy “upscale” women’s clothing, the women’s apparel retailer is operating as a shadow of its former self, beset by falling traffic to malls and offering styles that can also be found at rivals like Loft and at department stores. The Limited’s appeal may be getting muddled​ further by its recent “Backroom” off-price effort. Representatives of Sun Capital and Guggenheim declined to comment to The Wall Street Journal on news of a possible sale.

Not all mall-based retailers are in despair. Teen apparel retailer Aeropostale was recently rescued by a consortium that includes two mall landlords, a vote of confidence that has led to speculation that the once-bankrupt retailer could bounce back with 500 healthy stores.