Bed Bath & Beyond Bankruptcy: What Will Happen to BBBY Shareholders (2024)

Bed Bath & Beyond Bankruptcy: What Will Happen to BBBY Shareholders (1)

Bed Bath & Beyond (BBBY) recently issued a warning that it may file for bankruptcy following poor sales performance. The company is considering various strategic alternatives, including restructuring, debt refinancing, additional debt, delaying business activities, and selling assets to revive its business.

If BBBY files for bankruptcy, shareholders need to be aware that there are two types of bankruptcy: Chapter 11 and Chapter 7. Under Chapter 11, the company provides a plan to reorganize its business, while Chapter 7 bankruptcies are filed by companies that have no way out and cannot continue their business operations. If a company files for Chapter 11 bankruptcy, day-to-day operations will continue to run, but major corporate decisions will have to be approved by the bankruptcy court. The company’s stock and bonds will continue to trade on the market. Shareholders have the last claim during bankruptcy and may not receive anything if secured and unsecured creditors are not fully paid.

In the event of a liquidation, secured creditors are paid first, followed by unsecured creditors, and shareholders have the last claim. Shareholders may not receive anything if secured and unsecured creditors are not fully paid. Even if a company is successful in reorganizing its business, the ownership structure of the reorganized company will be different. The company’s plan of reorganization will cancel the existing equity shares, and shareholders may face substantial dilution.

Bed Bath & Beyond has fallen short of keeping up with changing retail trends and took a hit when it closed stores during the Covid pandemic. It has been trying to forge a way forward, but none of its turnaround strategies have hit the sweet spot. Experts suggest conducting due diligence by reading the latest news, conducting technical and fundamental analyses, and studying a wide range of commentary before making any trading decisions. Remember, your decision to trade should depend on your attitude to risk, your expertise in the market, the spread of your portfolio, and how comfortable you feel about losing money.

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Bed Bath & Beyond Bankruptcy: What Will Happen to BBBY Shareholders (2024)

FAQs

Bed Bath & Beyond Bankruptcy: What Will Happen to BBBY Shareholders? ›

With regard to the original BBBYQ stock (with the Q specifying it's now in bankruptcy proceedings), Pachter noted that the company's debt exceeded its assets even after Overstock

Overstock
Beyond, Inc. is an American online retailer headquartered in Midvale, Utah. Previously known as Overstock.com, Inc., the company acquired and adopted the name of bankrupt big-box retailer Bed Bath & Beyond in 2023. The company sells home decor, furniture, bedding, and many other goods that are closeout merchandise.
https://en.wikipedia.org › wiki › Bed_Bath_&_Beyond_(onlin...
paid in $21 million. "BBBY shareholders are likely to be left with worthless stock.

What will happen to BBBY stockholders? ›

Bed Bath & Beyond's stock will cease trading and the husk of the company will no longer exist. What remains of its roughly $42.2 million in assets will transfer to wind-down debtors. The court filing reports the company's debt at $1.5 billion.

What does bed bath and beyond bankruptcy mean for shareholders? ›

Bankrupt Bed Bath & Beyond filed their Ch. 11 plan on July 20, just before midnight. Shareholders get no recovery and shares will be cancelled. Unsecured noteholders could, in theory, get a recovery from a liquidating trust that is being created. The retailer is being completely liquidated.

Will bed, bath, and beyond stock ever recover? ›

Bed Bath & Beyond's former stock is finally gone, and it isn't coming back. The struggling meme stock has finally been extinguished after many months of struggling. Its story should be a cautionary tale for retail investors as any of its peers could be next.

What happens to shareholders in Chapter 11? ›

While Chapter 11 can spare a company from declaring total bankruptcy, the company's bondholders and shareholders are usually in for a rough ride. When a company files for Chapter 11 protection, its share value typically drops significantly as investors sell their positions.

What happens to stockholders when a company is delisted? ›

If a company is delisted, you are still a shareholder, to the extent of a number of shares held. And yet, you cannot sell those shares on any exchange. However, you can sell it on the over-the-counter market. This means you can look for a buyer outside the stock exchange.

Why can't I sell my BBBY shares? ›

Bankruptcy and Delisting

If the company finds a buyer in time, some or all of Bed Bath's stores may be spared closure. However, Bed Bath & Beyond will have to fully liquidate if no buyer appears. On April 25, in the wake of its bankruptcy filing, Bed Bath & Beyond shares were delisted from Nasdaq.

Who are the largest shareholders of Bed Bath and Beyond? ›

With that in mind, let's take a look at Bed Bath & Beyond's top shareholders:
  • BlackRock (NYSE:BLK): 11.48 million shares. ...
  • Vanguard: 8.20 million shares. ...
  • State Street (NYSE:STT): 3.09 million shares. ...
  • Allianz Asset Management: 1.75 million shares. ...
  • Geode Capital Management: 1.35 million shares.
Jan 12, 2023

Will BBBY be delisted? ›

Hi, shares of Bed Bath & Beyond (BBBY) have been delisted. This security has been deemed to have no stockholder equity, it is now considered worthless.

What type of stockholder would get paid last in case of a company bankruptcy? ›

Stock values are adversely affected by bankruptcy speculation, and even more so by the actual filing. After filing for Chapter 11, the company's stock will be delisted from the major exchanges. Common stock shareholders are last in line to recover their investments, behind bondholders and preferred shareholders.

What is the future of bed bath and beyond? ›

But the retailer will live on online after longtime rival Overstock won its intellectual property at auction in June. The e-commerce company, which has long felt its name was a detriment to its business, will instead merge its business under the Bed Bath & Beyond domain.

Is it smart to buy Bed Bath and Beyond stock? ›

Is Bed, Bath & Beyond a good stock to buy? Meme stocks like Bed, Bath & Beyond are high risk because of their share price volatility.

Who sold all their Bed Bath & Beyond stock? ›

RC Ventures, the firm run by activist investor Ryan Cohen, has sold its entire Bed Bath & Beyond stake for $178 million. The sales came this week as shares benefited from a meme-fueled rally.

What is the stock price prediction for BBBY in 2024? ›

Predicted Opening Price for BigBear.ai Holdings of Tuesday, April 30, 2024
Fair opening price April 30, 2024Current price
$1.77 ( 1.33%)$1.75

What happened to stock after merger? ›

When one company acquires another, the stock price of the acquiring company tends to dip temporarily, while the stock price of the target company tends to spike. The acquiring company's share price drops because it often pays a premium for the target company, or incurs debt to finance the acquisition.

Who are the top shareholders of BBBY stock? ›

The five most prominent BBBY holders, according to data from Market Screener, are Davis Selected Advisers, Capital Research & Management Co., The Vanguard Group, Sands Capital Management and Legion Partners Asset Management.

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