Overstock Secures Approval for $21.5 Million Bed Bath & Beyond Brand Acquisition
June 29, 2023: In a significant development, Overstock has received approval from a US bankruptcy judge for its $21.5 million purchase of the Bed Bath & Beyond brand name, intellectual property, and e-commerce platform. This decision was made during a court hearing in Newark, New Jersey, presided over by US Bankruptcy Judge Vincent Papalia, who expressed satisfaction with the emergence of a bidder committed to preserving Bed Bath & Beyond’s brand.
The successful bid by Overstock, as revealed in court filings, encompasses the acquisition of Bed Bath & Beyond’s intellectual property, including its business data, mobile app rights, and specific contracts. Notably, this deal does not include Bed Bath & Beyond’s physical stores and inventory, which remain separate entities.
Bed Bath & Beyond, once a prominent retailer, sought Chapter 11 bankruptcy protection in April due to prolonged struggles with declining sales and an unsuccessful merchandising strategy. In its ongoing efforts to restructure, Bed Bath & Beyond is hosting a separate auction for its Buy Buy Baby chain, which specializes in products for infants and toddlers. Investment firms Go Global Retail and Sixth Street Partners have expressed interest in the Buy Buy Baby assets.
Moreover, Bed Bath & Beyond is winding down its store footprint, finalizing numerous lease transfer agreements following a successful lease auction. According to Emily Geier, the company’s attorney, this progress is being made. However, negotiations with lenders have faced challenges, leading to a court hearing to defend a $240 million loan taken out by Bed Bath & Beyond at the beginning of its bankruptcy case. Junior bondholders alleged that the loan was based on inaccurate financial information, resulting in excessive borrowing and impacting repayments for junior creditors. The company’s legal team maintains that the bankruptcy loan was negotiated in good faith and provided the necessary funding for an organized sale of its assets.
Overstock’s approval for the $21.5 million acquisition of Bed Bath & Beyond’s brand name signifies a significant step in the bankruptcy proceedings. While Bed Bath & Beyond continues its efforts to address various aspects of its business, including the Buy Buy Baby chain and negotiations with lenders, the acquisition by Overstock.com ensures the preservation and potential revitalization of Bed Bath & Beyond’s brand
