Tag: Bed Bath & Beyond

A Bankrupt Retailer Is Now Making A Massive Comeback

A bankrupt retailer is now making a massive comeback according to an executive who’s company took it over.

Overstock.com, which now owns Bed Bath & Beyond says plans are on the works for a much bigger and bolder company.

The company has bet its future on the Bed Bath & Beyond brand after it declared Chapter 7 bankruptcy, and has even rebranded under its name.

The company’s chief executive, Jonathan Johnson says “Over the last three months, we have accelerated our efforts to build the company with a bigger, brighter, bolder future.”

“On June 28, we acquired the Bed Bath & Beyond brand and IP, a brand ranked in the top five most recognizable home brands in the United States, alongside titans like Target, Walmart, and Home Depot.

“Within hours of closing the deal, we revived the brand in Canada, and in just 33 days we launched the brand in the U.S. under our unique asset-light [ digital without stores] operational model,” he continued.

Johnson explained that Overstock had actually considered buying Bed Bath & Beyond “just a few years ago,” however, that purchase would have cost the company roughly $2 billion contrary to the $175 million they acquired it for.

Explaining why the deal was a steal, the Chief Executive stated the following:

“First, the No. 5 most recognizable brand in the home space and as an aside in that same ranking Overstock was No. 25; second an over 100 million person customer file; third, vendor relationships with some of the biggest home category brands in the world; and fourth, valuable intellectual property.”

“Earlier this week, we announced our new corporate name Beyond. This new corporate identity builds on the value of our iconic consumer brand. It also recognizes our ability to transform into more than just a single-brand e-commerce retailer,” he said.

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Market News Today - A Bankrupt Retailer Is Now Making A Massive Comeback.
Market News Today – A Bankrupt Retailer Is Now Making A Massive Comeback.

A massive Walmart now unexpectedly closes and liquidates its inventory at 75% off in Connecticut.

“A recent surprise announcement of yet another 2023 Walmart store closure, this one a location in Norwalk, Connecticut, has led customers to enthusiastically take advantage of the store’s current liquidation sale,” reports Joel Eisenberg.

The store, located at 680 Connecticut Avenue is closing on November 3rd.

“There are 4,623 Walmart stores in the United States as of October 16, 2023“, reports ScrapeHero.

According to an October 28th report from The-Sun, a large percentage of the store’s inventory, such as fresh groceries, has already sold out.

The company promised jobs will be available at other locations for any of the 255 workers who wish to remain with the company.

The company is currently listing approximately 280 positions in Connecticut.

“We are grateful to the customers who have given us the privilege of serving them at our Connecticut Avenue location,”  stated Walmart spokesperson Felicia McCranie, in an email to CT Insider

Residents on the other hand are not as thrilled.

“I’m here all the time, so it’s definitely a little bit frustrating,” said Missy Dye Radin, a Norwalk resident who was shopping for schools supplies for her son.

“It’s definitely going to be a loss for the community, I think, because you are just limited about where you can go.”

On Connecticut Avenue, Target surfaced earlier this year as a potential replacement tenant, but has yet to confirm it is moving ahead with the store in response to CT Insider queries.

“Target is more expensive,” Radin said. “You can get everything you need for your house, but I just feel like you’re getting a better value at Walmart.”

Also Read: A US Company Now Declares An Unexpected Bankruptcy

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Market News Today - A Bankrupt Retailer Is Now Making A Massive Comeback.
Market News Today – A Bankrupt Retailer Is Now Making A Massive Comeback.

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What is The Possibility of Bed Bath & Beyond Going Bankrupt?

Market News Today: is Bed Bath & Beyond going into bankruptcy?
Market News Today: is Bed Bath & Beyond going into bankruptcy?

(Bloomberg) Bed Bath & Beyond Inc. edged closer to a bankruptcy filing on Thursday after the retailer said it had received a default notice from JPMorgan Chase & Co., its loan agent, and warned it didn’t have enough funds to make payments. 

Creditors are demanding immediate repayment of the company’s debt after it breached the terms of a credit line, according to a regulatory filing Thursday.

Bed Bath & Beyond listed around $2.1 billion of obligations it owed as of November. 

Bed Bath & Beyond stock rose 8.3% at 9:45 a.m. in New York trading on Friday. The shares plunged 22% on Thursday. 

Will Bed Bath & Beyond go bankrupt?

Retail investors certainly don’t think so.

Here’s what sources are saying about the company.

How Likely is it Bed Bath & Beyond Defaults?

“Generally, in situations like this where a company defaults on their loan agreement our experience is, if they don’t come to an agreement with their lenders, the likelihood of a bankruptcy filing within the next 30 days is relatively high,” said Dennis Cantalupo, chief executive officer of Pulse Ratings, a credit-rating and consulting firm.

Bed Bath & Beyond had said earlier this year that it was considering all options to fix its strained finances, including the possibility of filing for bankruptcy. 

“At this time, the company does not have sufficient resources to repay the amounts under the credit facilities and this will lead the company to consider all strategic alternatives, including restructuring its debt under the US Bankruptcy Code,” the company said in the filing.

In an emailed statement, a Bed Bath & Beyond spokeswoman said the company is continuing to “work with our advisers and implement actions to manage our business as efficiently as possible.” She added: “We will update all stakeholders on our plans as they develop and finalize.”

The notice is the latest sign that one of the largest sellers of home goods in the US is likely to seek bankruptcy protection in short order after years of falling revenue.

The company has begun speaking with potential lenders that would fund the firm during bankruptcy proceedings, Bloomberg reported earlier. 

Related: Bed Bath & Beyond CFO Dies After Insider Trading Lawsuit Claims

What Are Shareholders Saying?

Shareholders aren’t convinced BBBY stock will get delisted through bankruptcy.

The BBBY community say on social media they are buying more of the company stock.

Others are speculating the company will see a merger very soon, eliminating all possibilities of bankruptcy.

Regardless of where retail investors stand, it’s important to stay informed and have a plan in place to prevent severe or total losses.

Declining Demand

Bed Bath & Beyond Bankruptcy News.
Bed Bath & Beyond Bankruptcy News. Is Bed Bath & Beyond Going Bankrupt?

“I’m expecting a filing any day,” said Cristina Fernández, a Telsey Advisory Group analyst. “I’m not sure what other avenues there are for them at the moment.” 

Fernández said she had visited a Bed Bath & Beyond store in Paramus, New Jersey, in recent days and noticed that many shelves were bare — echoing the observations of many shoppers in recent months as the retailer struggles to convince suppliers to supply merchandise. 

Bed Bath & Beyond’s revolving credit line, administered by JPMorgan, is secured by a claim on its inventory, the fluctuating value of which determines the amount of credit available at any given point.

The company must provide regular updates to the bank regarding the value of inventory it has on hand, calculated at an agreed discount. 

The filing indicates that the value of Bed Bath & Beyond inventory during the most recent update to JPMorgan had fallen below the amount the company had already borrowed from its revolver.

The mismatch breaches the terms of the loan and must be remedied by a cash payment in order to avoid a default.

Recent BBBY Stock News

Bed Bath & Beyond said it had appointed Carol Flaton to its board.

Flaton specialized in restructuring and turnarounds at consultancy AlixPartners and also at the bank Lazard.

The retailer said she will be paid $30,000 per month. 

Will Flaton be able to turn Bed Bath & Beyond around?

I’d love to hear your thoughts in the comment section below.

About Bed Bath & Beyond 2023

The ubiquitous US brand, founded in 1971 in Union, New Jersey, Bed Bath & Beyond was once a staple of going-to-college shopping lists and wedding registries.

The firm’s decline has been years in the making and has accelerated in recent months as suppliers become increasingly concerned about the retailer’s future and demand to receive payments in advance.

Other manufacturers have lowered their credit limits with the retailer in order to reduce the risk of not getting paid.

That limited the retailer’s merchandise during the pivotal holiday season, exacerbating a vicious cycle of falling inventory levels, declining foot traffic and declining revenue — making it harder, in turn, to pay suppliers.

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