Bed Bath & Beyond in Talks to Sell Assets

Bed Bath & Beyond, the struggling home goods retailer, is in talks with the private equity firm Sycamore Partners to sell assets, including its Buy Buy Baby stores, as part of a possible bankruptcy process, people familiar with the matter said. The retailer is also in talks with other suitors about possible transactions.

Buy Buy Baby’s fall hasn’t been as sharp as that of its parent, the DealBook newsletter reports.Bed Bath & Beyond overexpanded and struggled to remain competitive, but Buy Buy Baby has maintained a strong position in a clearly defined market, and its fall in sales has been less pronounced. The infant and children’s goods chain generated about $1 billion in sales in 2020, according to an investor presentation.

Bed Bath & Beyond this month said it was looking for fresh funds after a disappointing holiday season, including a sale of itself in pieces or as a whole. Discussions with various parties are continuing and may not result in a deal.

The people with knowledge of the talks spoke on condition of anonymity because the conversations were confidential. A spokeswoman for Bed Bath & Beyond reiterated that multiple paths “are being explored.” A spokesman for Sycamore declined to comment.

Sycamore knows the distressed retail market well. The firm has acquired a range of retailers, including the big-box office supplier Staples, the department store Belk and the women’s apparel chain Talbots. Stefan Kaluzny, one of Sycamore’s co-founders, has years of experience and relationships in the retail and consumer sectors. His interest in pieces of Bed Bath & Beyond may foreshadow the kind of deal-making expected this year if the traditional financing market remains stuck.

In the wake of Bed Bath & Beyond’s bankruptcy warning this month, its stock has taken off. In shades of the meme-stock frenzy of 2021, its shares have more than tripled over the past five trading sessions.

Jordyn Holman contributed reporting.