Despite intense efforts to avoid the contingency, Bed Bath & Beyond has announced that it filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the District of New Jersey to implement an orderly wind-down of its businesses while conducting a limited marketing process to solicit interest in sales of some or all of its assets.
To facilitate the bankruptcy process, the company noted, Bed Bath & Beyond has received a commitment of $240 million in debtor-in-possession financing from Sixth Street Specialty Lending. Given court approval, the company expects this financing to provide the necessary liquidity to support operations during the Chapter 11 process.
Although it has commenced a liquidation sale, Bed Bath & Beyond 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. Bed Bath & Beyond is strategically managing inventory to preserve value. If it can arrange a successful sale, the company will pivot away from any store closings needed to implement the transaction. Bed Bath & Beyond maintained a belief that a dual-path process will best maximize value.
As it explores options, the company’s 360 Bed Bath & Beyond and 120 buybuy BABY stores and websites will remain open and continue serving customers as the company begins to effectuate the closure of its retail locations. Bed Bath & Beyond intends to uphold its commitments to customers, employees and partners, it stated, including continued payment of employee wages and benefits, maintaining customer programs and honoring obligations to critical vendors.
In announcing the bankruptcy filing, Sue Gove, Bed Bath & Beyond president and CEO, 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.”