Bed Bath & Beyond files for bankruptcy with plan to shut stores

BLOOMBERG 

Bed Bath & Beyond Inc filed for Chapter 11 bankruptcy in New Jersey with plans to shut down, putting thousands of jobs on the line.
The US housewares retailer will use the court process to begin liquidating its 360 Bed Bath & Beyond stores and 120 Buy Buy Baby shops, while also searching for a buyer for some or all of its assets, according to a statement. The company may “pivot away” from the store closings if there’s a successful sale.
Bed Bath & Beyond estimated it had assets of $4.4 billion and total debt of $5.2 billion as of late November, according to a court filing. The number of creditors is between 25,001 and 50,000, with BNY Mellon having the biggest unsecured claim of $1.18 billion. Bed Bath & Beyond’s chief financial officer, Holly Etlin, will serve as chief restructuring officer to manage the bankruptcy.
The Union, New Jersey-based company’s crisis spiralled this year, starting in January when it said there was “substantial doubt” about its ability to keep operating and that it was weighing options to restructure its debts. Later that month, it received a default notice from JPMorgan Chase & Co after breaching terms on a credit line.
The retailer received a last-minute lifeline from the hedge fund Hudson Bay Capital Management — a deal that would have given Bed Bath & Beyond more than $1 billion under certain conditions.
But the company failed to meet stock-price minimums, and the deal was terminated. Bed Bath & Beyond then said it would sell more shares in an effort to stave off a filing.
A unit of Sixth Street Partners is providing the company with a $240 million loan to help it fund itself in bankruptcy.
In 2022, the company embarked on a turnaround effort that gave it a $375 million rescue loan as it shuttered some stores and cut roughly 20% of its workforce. The plan, unveiled in August, was among the retailer’s latest comeback attempts as it struggled to keep up with e-commerce competitors and changing consumer shopping habits.
Bed Bath & Beyond’s demise is not, as some pundits have insisted, an example of the decline of brick-and-mortar retailers that struggle to compete against Amazon.com.