Bed Bath & Beyond Canada is going out of business.
Bed Bath & Beyond’s latest effort to turnaround its ailing business does not include its Canadian operations.
Bed Bath & Beyond Canada is “insolvent” and its corporate parent (Bed Bath & Beyond Group) has “reluctantly concluded” that, even with its recent equity offering, it does not have enough capital available to both restructure its U.S. business and also bring the Canadian business back to profitability, according to filings with an Ontario court.
The filings were reposted on the website of consultancy Alvarex and Marsal, which has been appointed as a monitor of the business in the Canadian court case.
In the filing, Bed Bath & Beyond Canada said it is not profitable on a standalone basis and has realized significant net losses for the nine months ending November 26, 2022. The retailer plans to undertake an orderly liquidation of its remaining inventory with “assistance from a third-party professional liquidator and vacate its leased retail stores and premises.” There are 54 Bed Bath & Beyond stores and 11 Buybuy Baby locations in Canada.
“The wind-down process must be commenced as soon as possible to maximize recoveries and limit costs by ensuring that BBB Canada can exit from all retail stores as soon as practicable and avoid further rent, employee costs, critical supplier/service provider fees, bank fees, and other ongoing amounts,” the retailer’s representatives said in the filings.
The embattled home goods retailer filed its Canadian division for protection under Canada’s equivalent of Chapter 11 bankruptcy protection: Companies’ Creditors Arrangement Act.
Last week, Bed Bath & Beyond completed an equity offering of preferred stocks and warrants that raised about $225 million in cash, with an additional $800 million more to come in future installments.
The retailer also gave a “strategic update” on its plan to save its ailing business that included some new details. The company plans to shrink its total footprint to approximately 360 Bed Bath & Beyond stores and about 120 Buybuy Baby stores.
“We are optimizing our store fleet and supply chain and continuing to invest in our omni-always capabilities,” stated CEO Sue Gove. “This will enable us to better serve our customers, and grow profitably, by directing merchandise where and how they want to shop with us. We are also prioritizing availability of leading national and emerging direct-to-consumer brands."