Bed Bath & Beyond: still hope?











Photo credit © Reuters


(Boursier.com) — Bed Bath & Beyond would have found a new source of funding, according to the Wall Street Journal. The American retailer, in great difficulty after being abruptly “dropped” by its shareholder Ryan Cohen, would therefore have found a source of financing to replenish its liquidity, explain people familiar with the subject to the WSJ. The company would thus have informed potential creditors yesterday that it would have selected an establishment to provide it with a loan, after a process led by JP Morgan Chase.

It would therefore be a potential breath of fresh air for the group, which has completely collapsed on the stock market in recent days. Some suppliers have even interrupted shipments due to unpaid invoices, according to the Bloomberg agency. This file was yet THE undisputed star of small American carriers. The title of the American distribution chain had previously almost quintupled over a month! But that was before Ryan Cohen, the president of GameStop, sells its entire stake in the capital of ‘Bed Bath’. He held 11.8% in the capital of “BBBY”, and it was his entry into the round of the table that had caused an incredible speculative surge. BBBY, which had become a ‘meme stock’ on Wall Street, had nevertheless left the greatest hopes of recovery to small American shareholders, gathered on social networks and in particular Reddit. Nonetheless, Cohen’s abrupt exit from capital shattered those dreams of quick and easy fortune.

RC Ventures initially declared a 9.8% equity stake in March and was considering discussing strategic alternatives with the board, including a possible spin-off of the buybuy chain Baby selling children’s items. Three board appointments had been granted to Cohen. BBBY’s managing director, Mark Tritton, had been replaced. This vast reorganization also took place after a drop in like-for-like sales at Bed Bath & Beyond. But Cohen, instead of following through on his activist intentions, pocketed millions of dollars quickly by taking advantage of the ‘meme stock’ movement. The estimated capital gain for the businessman is 68 million dollars, a gain of 56% in seven months. Acquired for 121 million dollars, the stake was sold for approximately 189 million.

It should also be remembered that according to information from Bloomberg at the end of last week, Bed Bath & Beyond would have hired the firm Kirkland & Ellis to help it solve its massive debt problem, which would have become unmanageable in a context of drop in sales. Kirkland is known for his expertise in restructuring and bankruptcy situations, and must therefore advise “BBBY” on its options for refinancing existing debt and raising funds.


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