Bed Bath & Beyond has filed for Chapter 11 bankruptcy protection after failing to secure funds to stay afloat and all 360 nationwide stores will eventually close putting 30,000 jobs at risk.
The Union, New Jersey-based home goods retailer filed for bankruptcy in a District of New Jersey court, listing both its estimated assets and liabilities in the range of $1 billion and $10 billion, according to a court filing.
Bed Bath & Beyond stores will stay open for the time being, but a liquidation process has begun which will eventually see all 360 of its stores closing.
That means many of its 30,000 workers face losing their jobs.
Bed Bath & Beyond said that it has received a commitment of approximately $240 million in debtor-in-possession financing from Sixth Street Specialty Lending Inc, according to a separate statement.
Bed Bath & Beyond is reportedly set to file for bankruptcy by the weekend
The company added that its 360 Bed Bath & Beyond and 120 buybuy BABY stores and websites will remain open and continue serving customers as it begins efforts to effect the closure of its retail locations.
Sue Gove, president & CEO of Bed Bath & Beyond Inc. said: ‘Millions of customers have trusted us through the most important milestones in their lives – from going to college to getting married, settling into a new home to having a baby.
‘Our teams have worked with incredible purpose to support and strengthen our beloved banners, Bed Bath & Beyond and buybuy BABY.
‘We deeply appreciate our associates, customers, partners, and the communities we serve, and we remain steadfastly determined to serve them throughout this process.
‘We will continue working diligently to maximize value for the benefit of all stakeholders.’
In February, the embattled retailer had planned to raise around $1 billion through the offering of preferred stock and warrants to avoid bankruptcy.
The company was able to raise $360 million from the complex deal helping it pay loan defaults and interest payments for senior notes.
But Bed Bath terminated the deal in late March and announced plans to sell $300 million worth of its shares while also once again warning it might have to file for bankruptcy if it could not secure the funds.
The business once thrived in the pandemic and commanded 1,500 stores across the US, before being hit with a tumultuous few years
Bed Bath & Beyond CFO Gustavo Arnal, 52, committed suicide in September 2022
The Union, New Jersey-based home goods retailer, which shot to popularity in the 1990s as a go-to shopping destination for couples making wedding registries and planning for new babies, has seen demand drop off in recent years as its merchandising strategy to sell more store-branded products flopped.
Last year’s moves to abandon that strategy, and to bring in more national brands that shoppers recognize, had not shown signs of working, with the company reporting a loss of about $393 million after sales plunged 33% for the quarter ending Nov. 26.
In January, the company raised doubts about its ability to continue as a going concern just months after it announced more than $500 million in new financing, as well as job cuts and 150 store closures.
Arnal, right, jumped to his death from the 18th floor of Manhattan’s ‘Jenga’ tower – two days after the firm announced plans to lay off thousands of staff and close 150 stores
Retailers in distress often look to bankruptcy protection after the holiday season to take advantage of the cash cushion provided by recent sales.
In February, according to a court filing, Bed Bath & Beyond’s Canadian operations were going out of business. The Canadian division, which operates 54 Bed Bath & Beyond stores and 11 buybuy BABY stores, is insolvent, the filing posted on the website of consultancy Alvarez & Marsal showed.
Bed Bath said in March it was seeking shareholder approval for a reverse stock split in the range of 1-for-5 to 1-for-10 and its board earlier in April urged shareholders to approve the split saying that if the plan fails, bankruptcy would be imminent.
