Estimated reading time: 3-4 minutes
SALT LAKE CITY — After filing for Chapter 11 bankruptcy protection in April, the mighty U.S. retailer Bed, Bath & Beyond is breaking up in liquidation bids, and Utah online giant Overstock.com appears poised to grab the chain’s branding, intellectual property and more. Properties. However, brick and mortar stores are not part of the deal.
Overstock made a low-ball bid of $21.5 million for the “shaking horse” last week, according to The Washington Post. Bed Bath & Beyond confirmed Thursday that it accepted the offer. If approved by a New Jersey bankruptcy court next week, Overstock will acquire Bed, Bath & Beyond’s brand name, business information and digital assets. Physical stores are not part of the deal. At its peak, Bed, Bath & Beyond operated more than 1,500 stores, but, as of early May, it was down to 350 locations.
In response to a Deseret News request, Overstock.com declined to comment until the deal is finalized. Shares of Overstock were up more than 17 percent by the end of regular trading on Thursday.
In the year Since the stock hit a high of around $81 per share in early 2014, the price of Bed, Bath and More has been on a downward spiral. In April this year, the share price dropped to just pennies. Analysts have pointed to a number of missteps by company executives, including a shift from third-party products to store-brand items and a large stock buyback program.
When the deal closes, Overstock will look for ways to capitalize on the intangible assets of Bed, Bath & Beyond, which includes Bed, Bath and about 120 other stores, and will look for a different way to divest part of the Buy Baby brand. The most valuable remaining asset of the company. Buy Baby’s assets will go up for auction next Wednesday, CNBC reports.
Last August, Bed, Base & Beyond announced it was closing stores and laying off employees to transform its business, the Associated Press reported. It closed about 150 name-brand stores and cut its workforce by 20 percent. He estimates those cuts will save the company $250 million in the fiscal year. In August, he said he had arranged more than $500 million in new financing.
Stuck in a long sales slump, the company announced in August that it would reverse its strategy of focusing on national brands rather than pushing its own store labels.
That changed the strategy adopted by former CEO Mark Triton, who was ousted last June after less than three years at the helm, according to the AP. The company said it will get rid of a third of its store brands in less than a year.
Following a bad financial report in January, Bed Bath & Beyond’s current president and CEO, Sue Gove, said the company struggled to hold much inventory due to credit issues with suppliers, but even in the face of dire financial news, she believed there was still a chance to save the business.
Related stories
The most recent business stories
Art RaymondMore stories you might want
[ad_2]