Kingswood Capital Management has agreed to acquire Cost Plus World Market from Bed Bath & Beyond Inc. No financial terms were disclosed. CPWM is a home goods retail chain.
UNION, N.J., Dec. 14, 2020 /PRNewswire/ — Bed Bath & Beyond Inc. (Nasdaq: BBBY) today announced that it has entered into a definitive agreement to sell its remaining non-core banner Cost Plus World Market (CPWM) to Kingswood Capital Management, a Los Angeles-based private equity firm.
Additionally, the Company approved a new $150 million accelerated share repurchase program (ASR), subject to market conditions, which will be in addition to the $225 million ASR announced on October 28, 2020. Both ASR programs are expected to be completed by no later than the end of the Company’s fiscal year on February 27, 2021. The Company has also expanded its total share repurchase program from up to $675 million to up to $825 million over the next three years by approving the new ASR program.
Mark Tritton, Bed Bath & Beyond’s President & Chief Executive Officer, said, “We’ve taken deliberate steps throughout the year to streamline our portfolio and fortify our strategic focus in Home, Baby and Beauty & Wellness, and today’s announcement represents the conclusion of this work. In all, we have unlocked significant value from the divestiture of 5 business concepts this year, and we have also meaningfully reduced our lease liability and overall debt. These actions provide greater financial flexibility to support our digital first, omni-always transformation and our commitment to deliver sustainable total shareholder return.”
Tritton added, “We are pleased to announce the approval of a second ASR program which reinforces our capital allocation principles to drive shareholder value creation and reflects a strong liquidity position and confidence in our strategic growth plan.”
Continues Fast-Paced Transformation with Definitive Agreement to Sell Cost Plus World Market
The Company has entered into a definitive agreement to sell CPWM to Kingswood Capital Management, a Los Angeles-based private equity firm. The purchase agreement includes 243 brick-and-mortar locations, the CPWM digital business, 2 distribution facilities and a corporate office located in Alameda, California, and it is expected that CPWM will continue to operate as a stand-alone retail brand. The transaction is anticipated to close prior to Bed Bath & Beyond’s fiscal year end in February 2021, and is subject to customary closing conditions, including, among others, the expiration or termination of the applicable waiting period under the Hart-Scott Rodino Antitrust Improvements Act of 1976. Both companies have agreed to a transition service agreement following the close of the transaction to help ensure business continuity. Advisors to Bed Bath & Beyond on this transaction included B. Riley Securities Inc. and Bryan Cave.
Strengthening Capital Return to Shareholders
Bed Bath & Beyond has expanded its total share repurchase program from up to $675 million to up to $825 million over the next three years by approving a new ASR program to repurchase an aggregate of $150 million of Bed Bath & Beyond’s common stock, subject to market conditions. The new ASR program will be in addition to the $225 million ASR program announced on October 28, 2020. Both ASR programs, which will total $375 million, are expected to be completed by no later than the end of the Company’s fiscal year on February 27, 2021.
Bed Bath & Beyond is funding both ASR programs with existing cash resources primarily generated from the recent monetization of non-core assets.
Fiscal 2020 Third Quarter Earnings Release Date
Bed Bath & Beyond will report its fiscal 2020 third quarter financial results before the opening of the market on Thursday, January 7, 2021. The Company will host a conference call at 8:00 a.m. EDT that day with institutional investors and analysts to provide an overview of the Company’s performance for the quarter. The conference call may be accessed by dialing 1-888-424-8151, or if international, 1-847-585-4422, using conference ID number 8516932#. A live audio webcast of the conference call, along with the earnings press release, investor presentation and supplemental financial disclosures, will also be available on the investor relations section of the Company’s website at http://bedbathandbeyond.gcs-web.com/investor-relations. The webcast will be available for replay after the call.
About the Company
Bed Bath & Beyond Inc. and subsidiaries (the “Company”) is an omnichannel retailer that makes it easy for our customers to feel at home. The Company sells a wide assortment of merchandise in the Home, Baby, Beauty and Wellness markets. Additionally, the Company is a partner in a joint venture which operates retail stores in Mexico under the name Bed Bath & Beyond.