Bed Bath & Beyond to sell Cost Plus World Market to Kingswood Capital Management

Written by: Wajeeh Khan
December 14, 2020
  • Bed Bath & Beyond to sell Cost Plus World Market to Kingswood Capital Management.
  • The deal is expected to close before the end of fiscal 2021 in February.
  • Bed Bath & Beyond approved £112.52 million of share buybacks on Monday.

In an announcement on Monday, Bed Bath & Beyond Inc. (NASDAQ: BBBY) said it will sell its Cost Plus World Market business to Kingswood Capital Management. The deal, as per the home goods retailer, is likely to close before the end of fiscal 2021 in February.

Shares of the company jumped more than 1.5% in premarket trading on Monday but tanked roughly 4.5% on market open. The stock recovered the majority of its intraday loss later on. On a year to date basis, Bed Bath & Beyond is currently more than 15% up year to date in the stock market after an over 425% growth since the first week of April.

Bed Bath & Beyond approves £112.52 million of share buybacks

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The agreement with the private equity firm includes the speciality retail company’s 243 locations (brick and mortar), two distribution facilities, digital business, and an Alameda-based corporate office. Bed Bath & Beyond refrained from divulging further details of the deal on Monday.

The chain of domestic merchandise retail stores had announced £168.78 million of share repurchase in October. On Monday, Bed Bath & Beyond approved another £112.52 million of share buybacks to further step up the programme.

The share repurchase programme, the Union-based company added, is also expected to complete before the end of fiscal 2021. Bed Bath & Beyond said it will repurchase shares worth £618.88 million in the next 3 years as part of its stock buyback programme.

In a report published in the first week of October, Bed Bath & Beyond posted an 89% annualised growth in digital sales in the fiscal second quarter.

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CEO Mark Tritton’s comments on Monday

CEO Mark Tritton, who joined the company in 2019, commented on the news on Monday and said:

“We’ve taken deliberate steps throughout the year to streamline our portfolio and fortify our strategic focus in-home, baby, and beauty and wellness, and today’s announcement represents the conclusion of this work.”

Bed Bath & Beyond’s recent divestments include One Kings Lane, Christmas Tree Shops, Linen Holdings, and Personalization Mall – all of which were directed at expanding investment in its namesake brand. The retailer said last week that D.E. Shaw and BlackRock had taken bigger stakes in it.

Bed Bath & Beyond performed largely upbeat in the stock market last year with an annual gain of more than 40%. At the time of writing, it is valued at £1.79 billion.