Bed Bath & Beyond emerges as activist Ryan Cohen pushes for sale

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(Bloomberg) — Shares of Bed Bath & Beyond Inc. rose in premarket trading Monday after Ryan Cohen’s investment firm RC Ventures disclosed a 9.8% stake in the retailer and asked him to consider a sale of the entire company.

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The Union, New Jersey-based home goods retailer jumped as much as 55% in early trading after Cohen said Bed Bath & Beyond should consider selling to a well-capitalized buyer or selling its baby products business. . In a letter sent Sunday to the company’s board, RC Ventures said its executives received “oversized” compensation relative to their performance.

Read More: Gamestop President Cohen Reveals His Involvement in Bed Bath & Beyond

Bed Bath & Beyond said Monday it will carefully review a letter from RC Ventures urging it to explore a sale and hopes to “constructively engage” with the company.

Cohen, co-founder of Chewy Inc. and chairman of GameStop Corp., has had a strong following of retailers who rallied shares of both the pet supply supplier and the video game retailer at the height of the coronavirus pandemic with consumers stuck at home. . GameStop increased 688% last year and 210% in 2020.

Bed Bath & Beyond, a favorite of so-called meme stock traders, reported quarterly sales that missed estimates and lowered its sales and adjusted earnings per share outlook for the current fiscal year when it released results last month. It had to increase prices and adjust its discount strategy due to supply chain and freight hurdles.

Last year, it was one of the first retailers to show how a variant of Covid-19 was affecting its supply chain, changing consumer behavior and eroding sales. He then announced an accelerated share buyback program and the launch of a new digital marketplace for merchandise from outside producers.

Its shares have plunged 42% in the past 12 months, while the S&P 600 consumer discretionary index was 9.7% lower and the S&P 500 was little changed in that period.

(Updates with share price movement, company comments and more details).

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