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Bed Bath & Beyond Inc. – Omnichannel Retailer Files for Bankruptcy with $4.4bn of Liabilities; Plans Wind-Down with Brief Market Check for Possible Asset Sale(s) Interest; Lines Up $240mn of DIP Financing

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[Just filed. Developing story.] April 23, 2023 – Bed Bath & Beyond Inc. and 73 affiliate debtors (Nasdaq: BBBY, “BBB“ or the “Debtors”) filed for Chapter 11 protection with the U.S. Bankruptcy Court in the District of New Jersey, lead case number 23-13359 (Judge TBA). The Debtors, “an omnichannel retailer with 949 stores and numerous websites,*” are represented by Michael D. Sirota of Cole Schotz P.C. Further board-authorized engagements include: (i) Kirkland & Ellis LLP as general bankruptcy counsel, (ii) AlixPartners LLP as financial advisors (with Alex Partners' Holly Etlin to serve as CRO and CFO), (iii) Lazard Frères & Co. LLC as investment bankers, (iv) Hilco Merchant Resources LLC to assist with inventory sales and (v) Kroll Restructuring as claims agent. 

* As of November 26, 2022, the Company had a total of 949 stores, including 762 Bed Bath & Beyond stores in all 50 states, the District of Columbia, Puerto Rico and Canada, 137 buybuy BABY stores and 50 stores under the names Harmon, Harmon Face Values or Face Values. The Company operates websites at bedbathandbeyond.com, bedbathandbeyond.ca, buybuybaby.com, buybuybaby.ca, harmondiscount.com, and facevalues.com.

The Debtors’ lead petition notes between 25,000 and 50,000 creditors; estimated assets between $1.0bn and $10.0bn; and estimated liabilities between $1.0bn and $10.0bn (the Debtors' most recent 10-Q notes assets of $4.4bn and liabilities of $5.2bn as at September 30, 2022). Documents filed with the Court list the Debtors’ three largest unsecured creditors as (i) BNY Mellon (as Trustee in respect of $1.185bn of unsecured bonds), (ii) Personalization Mall ($11.1mn trade debt claim) and (iii) Intersoft Data Labs Inc. ($6.8mn trade debt claim). All 30 of the Debtors' top 30 unsecured claims are in excess of $2.4mn.

In a press release announcing the filing, BBB provides that it had (finally) filed for Chapter 11 protection "to implement an orderly wind down of its businesses while conducting a limited marketing process to solicit interest in one or more sales of some or all of its assets. 

While the Company has commenced a liquidation sale, Bed Bath & Beyond Inc. intends to use the Chapter 11 proceedings to conduct a limited sale and marketing process for some or all of its assets. The Company has filed motions with the Court seeking authority to market Bed Bath & Beyond and buybuy BABY as part of an auction pursuant to section 363 of the Bankruptcy Code. Alongside these efforts, the Company is also strategically managing inventory to preserve value. In the event of a successful sale, the Company will pivot away from any store closings needed to implement a transaction. The Company believes this dual-path process will best maximize value."

DIP Financing

The Debtors' Petition date press release provides: "To facilitate this process, the Company has received a commitment of approximately $240 million in debtor-in-possession financing ("DIP") from Sixth Street Specialty Lending, Inc. Following court approval, the Company expects this financing to provide the necessary liquidity to support operations during the Chapter 11 process."

Key Prepetition Shareholders

  • BlackRock, Inc: 14% (as at December 31, 2022, down from 20.7% as at February 7, 2022)
  • The Vanguard Group: 7.31% (as at December 31, 2022)
  • FMR LLC:  13.7%
  • RC Ventures: 0% as at August 16, 2022 (having held 11.8% as at March 24, 2022)

About the Debtors

According to the Debtors: “Bed Bath & Beyond Inc. and subsidiaries…is an omnichannel retailer that makes it easy for our customers to feel at home. The Company sells a wide assortment of merchandise in the Home, Baby, Beauty and Wellness markets.  Additionally, the Company is a partner in a joint venture which operates retail stores in Mexico under the name Bed Bath & Beyond.

The Company operates websites at bedbathandbeyond.com, bedbathandbeyond.ca, buybuybaby.com, buybuybaby.ca, harmondiscount.com, and facevalues.com. As of November 26, 2022, the Company had a total of 949 stores, including 762 Bed Bath & Beyond stores in all 50 states, the District of Columbia, Puerto Rico and Canada, 137 buybuy BABY stores and 50 stores under the names Harmon, Harmon Face Values or Face Values. During the fiscal 2022 third quarter, the Company closed 6 Bed Bath & Beyond stores. The joint venture to which the Company is a partner operates 12 stores in Mexico under the name Bed Bath & Beyond.”

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The post Bed Bath & Beyond Inc. – Omnichannel Retailer Files for Bankruptcy with $4.4bn of Liabilities; Plans Wind-Down with Brief Market Check for Possible Asset Sale(s) Interest; Lines Up $240mn of DIP Financing appeared first on Daily Bankrupt Company Updates | Bankrupt Company News.


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