Overstock.com, the popular online retailer, has made a significant move in the retail industry by agreeing to acquire certain assets from struggling retailer Bed Bath & Beyond.
The deal, valued at a whopping $21.5 million, comes as Bed Bath & Beyond faces financial difficulties due to declining sales and an unsuccessful merchandising strategy. In April, the beleaguered company filed for Chapter 11 bankruptcy protection, hoping to restructure its operations and turn its fortunes around.
The acquisition by Overstock.com includes a range of assets, such as intellectual property, business data, and mobile application rights. This transaction is categorized as a “stalking horse” bid under the United States Bankruptcy Code, meaning it serves as an initial offer that sets a floor price for potential competing bids. Bed Bath & Beyond will continue to invite additional bids until the deadline, and if any are received, an auction is scheduled to take place in the following week.
While Bed Bath & Beyond grapples with its financial challenges, another player is eyeing a potential acquisition. Retail investment firm Go Global Retail is reportedly in negotiations to acquire Bed Bath & Beyond’s Buybuy Baby chain. This development showcases the interest and activity surrounding the troubled retailer, as various parties explore opportunities to salvage its assets and businesses.
The news of Overstock.com’s acquisition has already generated positive market sentiment, with the company’s stock rising by 3.4% during afternoon trading. Investors appear to be optimistic about the potential benefits that this move could bring to Overstock.com and its overall market positioning.
As part of the deal, Overstock.com has already delivered 10% of the purchase price in cash to the escrow agent. This initial payment demonstrates Overstock.com’s commitment to the acquisition and its confidence in the potential value of the assets it will acquire from Bed Bath & Beyond.