On Sunday, Bed Bath & Beyond filed for Chapter 11 bankruptcy protection after it failed to stay afloat due to insufficient funds.
The company’s stock price declined by -2.17% to $0.29 on April 21. Likewise, it is expected to plunge by -4.57% to $0.28 in the upcoming session.
In recent years, its demand seemed to drop off since the merchandising strategy of the home goods retailer flopped. Last year, it ditched that strategy and brought in more national brands which are familiar to shoppers. However, it could have been more effective.
Bed Bath & Beyond reported a loss of $393.00 million as its sales plunged 33.00% for the quarter that ended on November 26.
According to the company, it earned a commitment of $240.00 million in debtor-in-possession financing from Sixth Street Specialty Lending Inc. Also, it plans on using its Chapter 11 proceedings for a limited sale and marketing process for its assets.
In January, Bed Bath & Beyond had concerns about its ability to continue. This came after announcing over $500.00 million in new financing. In addition, they had job slashes and shut down around 150 stores.
The following month, the struggling retailer aimed to raise $1.00 billion through stock offerings and warrants to prevent bankruptcy.
As a result, it managed to raise $360.00 million from contracts that helped the firm. Furthermore, it contributed to loan defaults and interest payments for senior notes.
Inventory Liquidation Planned by Bed Bath & Beyond
Bed Bath & Beyond will start its closing sales on Wednesday as it will close some stores. It may affect its 14,000 employees.
Based on the retailer’s statement, it seeks to sell some or all of its business. If they manage to find a buyer, they will stop closing stores. On the other hand, without a buyer, the company would be liquidated entirely and shut down the business.
According to analysts, Bed Bath & Beyond could emerge from bankruptcy as an online-only retailer.
From Monday to Tuesday, shoppers could use their remaining 20.00%-off coupons. However, it will stop accepting them on Wednesday. Instead, it is expected to offer deep product discounts as a factor in its going-out-of-business sales.