Bed Bath & Beyond reportedly selling assets to private equity firm, retailer says no comment
Alongside other key assets, the retailer’s Buy Buy Baby stores will reportedly be cut free after showing another dip in sales over the third quarter, according to the article.
The Union, New Jersey-based company had earlier considered selling its Buy Buy Baby stores after shareholder pressure, but held off on hopes it could fetch a higher price later, Reuters reported.
The company’s buybuy Baby chain, which sells products for infants and toddlers, helped Bed Bath & Beyond obtain a loan worth $375 million last year.
A spokesperson for Bed Bath & Beyond told FOX Business on Friday, “As is our practice, we do not comment on speculation of this nature.”
“We remain committed to updating our key stakeholders as we collectively work to execute our near- and long-term goals for the future,” the spokesperson said.
Meanwhile, the New York-based equity group also declined comment on the potential sale. Sycamore invests in consumer goods firms and retailers. It hit the headlines last year with its takeover bid for department store chain Kohl’s Corp.
The troubled home goods retailer posted a bigger-than-expected quarterly loss and a plunge in sales on Tuesday, after saying last week it was exploring options, including bankruptcy, as it struggled with a dwindling cash pile.
The net loss for the fiscal third quarter ended Nov. 26 widened to $393 million from $276.4 million a year earlier. It included a $100.7 million impairment charge, indicating the value of the company’s inventory was below its original estimates.
The retailer reported an adjusted loss of $3.65 per share, wider than Wall Street’s estimate of a $2.23 per share loss.
Cash and cash equivalents declined steeply to $153.5 million from $509 million, making it challenging for the retailer to secure more merchandise for its stores.
Net sales fell 33% to $1.26 billion.
Foot traffic fell 23.1% in November from the previous year, according to data from Placer.ai.
Inventory fell by a quarter to $1.44 billion in the third quarter, after the retailer shed some of its own brands including Wild Sage and offered steep Black Friday discounts to move merchandise.
Despite the ongoing rumors, shares for Bed Bath & Beyond exploded this week, ballooning 248% over the last five days as frenzied day traders began shorting the stock.
Reuters contributed to this report.
|BBBY||BED BATH & BEYOND INC.||3.95||-1.29||-24.65%|