A person walks into a Bed Bath & Beyond store on October 01, 2021 in the Tribeca neighborhood of New York City.
Michael M. Santiago | Getty Images
bed bath behind It announced Friday that it had struck a deal with activist investor Ryan Cohen, sending the company’s stock soaring.
Shares jumped more than 12% in pre-market trading, but were up about 3% later in the morning.
The home goods retailer said in a press release that three people selected by Cohen’s company, RC Ventures, will immediately join Bed Bath’s board of directors as independent directors. Among them are Marjorie Bowen, Shelley Lombard and Ben Rosenzweig.
The company said a four-person panel will look into alternatives to its Buybuy Baby chain and make recommendations to the board. That committee will include Bowen and Rosenweig.
Bed Bath was in the middle of a transformation effort led by the former targeting CEO Mark Triton, who took the helm in 2019. This has included Comprehensive overhaul of many aspects of the company, including a heavy focus on private label, store remodeling and closing down underperforming locations. The retailer also sold other store signs, such as Christmas Tree Shops and Cost Plus World Market, to focus on its namesake brand.
Bath bed Sales and inventory performance has lagged, even as the pandemic fueled a hot real estate market and inspired Americans to invest in their homes. Shares are down about 23% over the past year. On Thursday, they closed at $22.10, bringing the company’s market capitalization to $2.13 billion.
Earlier this month, Cohen, who is also the chairman of the board of Jim StopAnd the Unveiled a stake of approximately 10% in Bed Bath And his intentions are to push the retailer to make sweeping changes. In a letter, Bed Bath’s leaders were criticized for charging high wages as they struggle to turn around the retailer’s performance. He called for a change in its operations, including taking a closer look at the children’s store chain being separated or sold.
Triton said Friday that the company’s leaders “look forward to incorporating the ideas of our new directors to drive our ongoing transformation” as part of the deal with RC Ventures.
“As we move forward, our goals will continue to focus on delivering value to our shareholders, enhancing experiences for our customers, implementing transformation across our business, and creating new and exciting opportunities for our dedicated employees across all of our banners,” he said in the press release.
Cohen described the decision as “a positive outcome for all Bed Bath shareholders.”
“I appreciate that the management and board have been willing to immediately embrace our ideas and we look forward to supporting them in the coming year,” he said in the press release.
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