BBBY - BBBY Stock Fell 47% As It Seeks $1 Billion To Escape Bankruptcy

BBBY Stock ( NASDAQ:BBBY )

As a final resort to avoid bankruptcy , Bed Bath & Beyond ( NASDAQ:BBBY ) said on Monday that it will raise about $1 billion via an offering of preferred stock and warrants. As a result, BBBY stock plunged.

In its securities filings, the home goods firm warned that it would “likely apply for bankruptcy protection” if it could not carry out the complicated deal. Concerns over the chain’s continued existence were sparked by an announcement it had defaulted on a loan in recent weeks.

Two sources familiar with the subject indicated that Bed Bath & Beyond ( NASDAQ:BBBY ) has been in discussions with an investment company to underwrite a significant amount of the potential transaction.

BBBY stock surged 92.1% on Monday to end at $5.86. It fell 43% in premarket trading on Tuesday when Bed Bath & Beyond announced the pricing of its initial public offering, closing at $3.30.

A total of 23,685 shares of Series A convertible preferred stock, 84,216 shares of Series A convertible preferred stock warrants, and over 95,000,000 shares of common stock warrants will be issued.

Bed Bath & Beyond anticipates an initial $225 million in gross profits from the sale, with a further $800 million to be raised in subsequent installments.

When activist investor and GameStop Corp ( NYSE:GME ) chairman Ryan Cohen invested in Bed Bath & Beyond and pushed for reform, the stock skyrocketed, reaching a $30 per share last year.

• Featured News RSS feed
• Investing News RSS feed
• Daily Press Releases RSS feed
• Trading Tips RSS feed
• Investing Videos RSS feed

Follow PressReach on Twitter
Follow PressReach on TikTok
Follow PressReach on Instagram
Subscribe to us on Youtube