Bed Bath & Beyond Files for Chapter 11 Bankruptcy as Efforts to Stay Afloat Failed

Troubled home goods retailer Bed Bath & Beyond filed for Chapter 11 bankruptcy protection in the US District Court of New Jersey this past weekend after last-minute attempts to keep the company afloat failed.

The Union, NJ-based company received a commitment of approximately $240 million in debtor-in-possession financing from Sixth Street Specialty Lending Inc to keep stores operating through the liquidation process.

The company said its estimated assets and liabilities are between $1 billion to $10 billion. Part of the proceedings include closing all 360 Bed Bath & Beyond locations and 120 Buybuy Baby retail stores.

“We deeply appreciate our associates, customers, partners, and the communities we serve, and we remain steadfastly determined to serve them throughout this process,” said CEO Sue Gove.

The company announced an effort in early February to raise $1 billion to stay in business and prevent a bankruptcy filing, but the effort brought in just $360 million. Another fundraising effort in March set a target for $300 million but resulted in just $48 million.

Bed Bath & Beyond shot to popularity in the 1990s as a go-to shopping destination for couples making wedding registries and planning for new babies, but it has seen demand drop off in recent years as its merchandising strategy to sell more store-branded products proved unsuccessful.

The company said it may abandon plans to close stores in the event of a successful purchase agreement. Nevertheless, it is moving forward with sales of remaining stock, while “strategically managing inventory to preserve value.”

If Bed Bath & Beyond ends up completely liquidating, it would be one of the largest going-out-of-business sales of the last 15 years – joining a club that includes Circuit City and Toys “R” Us.