Bed Bath & Beyond Announces Plan , to Raise $1 Billion to Avoid Bankruptcy.
CNBC reports that the retailer made the announcement on Feb. 6 in a securities filing.
The company intends to raise
$1 billion via an equity offering.
It will sell preferred stock, warrants and securities.
If Bed Bath & Beyond succeeds in raising the funds,
it will use them to repay outstanding debt.
Additionally, the company would make a
bond interest payment it missed on Feb. 1.
Another $100 million would also be
drawn from a Sixth Street FILO loan. .
If Bed Bath & Beyond can't complete the transaction, it will "likely file for bankruptcy protection.".
Some analysts doubt the company
will be able to pull it off.
Many investors are likely to be deterred by the incredibly weak balance sheet, the mountain of debt, and a business that remains fundamentally broken. They will see this as throwing good money after bad, Neil Saunders, managing director of GlobalData, via CNBC.
CNBC reports that on Feb. 6, Bed Bath & Beyond announced it will close another 150 stores.
Company shares were down 31.2%
in premarket trading on Feb. 7