Bed Bath & Beyond BBBY –22.15% has filed for chapter 11 bankruptcy protection in New Jersey district court, after a series of financial maneuvers designed to turn business around came up short.
The stock fell 36.9% in the Monday premarket.
Bed Bath & Beyond filed for Chapter 11 bankruptcy protection Saturday, after last-minute attempts to keep the company afloat failed.
The company has warned since January that it may have to file for bankruptcy due to its shockingly poor sales during the 2022 holiday season. The home goods retail store’s last-ditch efforts to raise cash to cover costs failed this weekend.
“Bed Bath & Beyond Inc. today announced that it and certain of its subsidiaries 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 one or more sales of some or all of its assets,” the company wrote in a statement.
“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 its efforts to effectuate the closure of its retail locations,” the statement continued. “Through the filing of customary motions with the Court, the Company intends to uphold its commitments to customers, employees, and partners, including continued payment of employee wages and benefits, maintaining customer programs, and honoring obligations to critical vendors.”
The company went on to say that 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.”
Bed Bath & Beyond closed 150 stores in 2022, and more closures were scheduled for 2023.
The company announced an effort in early February to raise $1 billion to stay afloat 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.
CEO Sue Gove issued a statement thanking the company’s longtime customers and associates on Sunday.
“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,” she wrote. “We deeply appreciate our associates, customers, partners, and the communities we serve, and we remain steadfastly determined to serve them throughout this process.”