Bed Bath & Beyond hires Goldman Sachs to explore asset sales
Bed Bath & Beyond might be throwing in the towel. Under pressure from activist investors, the struggling retailer has hired Goldman Sachs to evaluate potential offers for several of its core businesses, according to a report.
Among the Bed Bath & Beyond assets the company could choose to sell include its Cost Plus World Market division, The Deal’s Ronald Orol reports (subscription required). A former executive with the retailer, teaming up with a private equity firm, has offered $250 million for the unit, which Bed, Bath & Beyond bought in 2012 for $495 million.
The home goods company has also received offers for other assets, including competing bids of between $250 million and $300 million for PersonalizationMall, which sells personalized products, according to The Deal. Another private equity firm has expressed interest in buying all of Bed Bath & Beyond, though it remains unclear if the company is considering the offer, according to The Deal.
Bed Bath & Beyond shares jumped 11% on Thursday to close at $9.48. Before that bounce, the stock, which once traded for more than $50, had fallen 35% this year. The company declined to comment on the report.
Once the retail leader in kitchenware, Bed Bath & Beyond has struggled to retain consumers who are turning to deep discounters or shifting their spending online.
The explosion in ecommerce has many traditional brick-and-mortar retailers facing the chopping block. More than 12,000 stores are expected to shutter their doors for good in 2019, far exceeding the nearly 6,000 closings last year, according to Coresight Research. Bed Bath & Beyond, which operates 1,536 stores worldwide, expects to close 40 stores in its 2019 fiscal year.
Bed Bath & Beyond has faced additional pressure this year to improve performance in its stores from a trio of activist investor, which in May helped oustafter blaming him for years of flagging sales at the retailer.
Revenue growth at the retailer has declined since 2014. In the 12 months before March, Bed Bath & Beyond recorded a loss of $137 million and expects losses to accelerate in the next year.