NEW YORK (AP) — Shares of Bed Bath & Beyond plunged in premarket trading after the struggling home goods retailer announced a restructuring that includes store closures, layoffs and a stock offering.
The company said it has obtained more than $500 million of new financing and was reducing 20% of its workforce. It also plans to close about 150 namesake stores but will keep its buybuy Baby chain.
The retailer said Wednesday in the Securities and Exchange Commission filing that it may offer, issue and sell shares of its common stock from time to time. It plans to use the proceeds to pay down its debt, among other uses.
Bed Bath & Beyond, based in Union, New Jersey, has been facing lots of turbulence recently. In mid-August, shareholder activist Ryan Cohen, the billionaire co-founder of online pet-products retailer Chewy Inc., sold his entire stake in Bed Bath & Beyond after buying a big stake just months before and pledging to make big changes.
In June, Bed Bath & Beyond’s CEO was ousted amid slumping sales and supply chain issues.
Board member Sue Gove took over as interim CEO, replacing Mark Tritton. Bed Bath & Beyond hired Tritton in late 2019. He’d previously been the chief merchandising officer at Target where the more than 30 new brands he introduced were key in that company’s revitalization.
The company said that it is still searching for a permanent CEO. Chief Operating Office John Hartmann is leaving the company, and it's eliminating that position.
Shares fell more than 19%, or $2.37 to $9.74 in premarket trading on Wednesday, after closing down more than 9%, or $1.24 to $12.11 in regular markets Tuesday.