by NEW YORK, Jan 30 (Reuters) – Bed Bath & Beyond Inc (BBBY.O) is preparing to search bankruptcy safety as soon as this week, and has lined up liquidators to shut further shops until a last-minute purchaser emerges, 4 individuals acquainted with the matter stated on Monday.
The timing of any bankruptcy submitting was in flux Monday night, with the U.S. residence items retailer’s advisers locked in conferences exploring any remaining choices to keep away from it, one other particular person acquainted with the matter stated.
Bed Bath & Beyond is negotiating a mortgage to assist it navigate bankruptcy proceedings, with funding agency Sixth Street in talks to present some funding, two of the individuals stated. The agency loaned Bed Bath & Beyond $375 million final 12 months.
The chain, as soon as thought of a class killer in residence items like dinnerware and small home equipment, has lined up liquidators who’re readying retailer closing gross sales that could possibly be launched as soon as this weekend, two of the individuals stated.
The individuals spoke on situation of anonymity as a result of the talks should not public.
The chain has stated it’s closing 87 Bed Bath & Beyond shops and 5 buybuy BABY shops, as well as to 150 closures introduced final 12 months. It can be shutting its well being and sweetness low cost chain Harmon.
The individuals cautioned {that a} last-minute purchaser for the chain might emerge, or it might nonetheless ink a deal for its manufacturers such as buybuy BABY. Prospective consumers generally wait till an organization information for bankruptcy earlier than agreeing to buy belongings, hoping to negotiate extra favorable phrases.
Bed Bath & Beyond stated in a press release to Reuters that it continued to work with its advisers to take into account “a number of paths” however declined to touch upon any bankruptcy planning.
The firm has beforehand stated it was exploring a spread of choices to deal with plunging gross sales, together with promoting belongings, elevating financing and declaring bankruptcy.
Sixth Street declined to remark.
Bed Bath & Beyond stated final week it defaulted on a mortgage, bringing it nearer to bankruptcy. Sources have additionally advised Reuters that Bed Bath & Beyond is contemplating skipping debt funds due on Feb. 1, a typical transfer that distressed firms take to preserve money.
Retailers in misery typically resolve to file for bankruptcy safety after the vacation season to benefit from the money cushion offered by latest gross sales.
Toys R Us liquidated in March 2018 in one of many largest failures to date of a specialty retailer.
As of February 2022, Bed Bath & Beyond had 953 places, together with buybuy BABY.
Bed Bath & Beyond for years had been thought of a go-to procuring vacation spot for {couples} making marriage ceremony registries and planning for brand new infants, however it misplaced its footing when it tried to broaden into retailer manufacturers.
The retailer’s administration has since reversed course and aimed to usher in nationwide manufacturers consumers knew the chain for. But the technique has not gained traction with consumers.
Earlier this month, the corporate raised doubts about its skill to proceed as a going concern and stated it will lower jobs.
Bed Bath & Beyond reported a lack of about $393 million after gross sales plunged 33% for the quarter ending Nov. 26.
Reporting by Jessica DiNapoli and Mike Spector; Editing by Cynthia Osterman and Jamie Freed
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