Bed Bath & Beyond will live to see another day – at least for now.
The beleaguered home products retailer . Expects to receive $1 billion in equity from a . Hail Mary stock it hopes will stave off bankruptcy and liquidation. The company announced Tuesday.
Bed Bath will receive $225 million in. The upfront offering and an more $800 million in proceeds over time, the company said.
The company also. Secured another $100 million loan from Sixth Street Partners, among its lenders.
B. Riley Securities will be the sole bookrunner for the offering, the company said.
The cash infusion will be used to pay off some of the retailer’s debt after it defaulted on a loan with. JPMorgan last month and missed a $25 million interest payment . On Feb. 1, the company said in a securities filing.
Anything left over will be used to support Bed Bath’s efforts to make the change, the company said. But, it warned that if the deal doesn’t go through. The company will “likely” file for bankruptcy and see its assets depleted.
The retailer is desperate to stave off . Bankruptcy and is seeking investors willing to inject cash into the . Company or buy it, reported. Efforts have failed so far, forcing Bed Bath to go to the public market for funding.
Investors are likely to be wary of buying. Bed Bath’s volatile stock, but they may find some interest from a “less rational meme stock crowd” that may be. Willing to take the bait,” said Neil Saunders, managing director at GlobalData.
“In our view, this is the last roll of the dice from a company desperate to raise cash to pay down debt. and provide some financial headroom to . continue operations,” said Saunders, a veteran retail analyst and consultant.
“There is no guarantee that the offer will produce the desired results,” he said. “Many investors are likely to be discouraged by weak balance sheets. mountains of debt and broken businesses.”
On Monday, shares of Bed Bath. which became a meme stock favorite when activist investor . Ryan Cohen invested in the company last year, rose more than 100%. (Cohen sold his shares a few months later.) The stock, but, fell 35% on Tuesday. Its market value is around $445 million.