Bed Bath & Beyond
shares fell in extended trading on Wednesday after
president and activist investor Ryan Cohen signaled in a regulatory filing his intention to sell a stake in the home goods retailer, which is owned by his firm RC Ventures.
Cohen, who also co-founded a pet e-commerce company
filed Form 144 providing notice of its intent to sell up to 7.78 million shares and additional call options that would represent 1.67 million shares.
Form 144 is used when a company insider plans to sell more than 5,000 shares or has a total sale price of more than $50,000, according to the SEC. The 144 filer “must have a bona fide intention to sell the securities specified in the form within a reasonable time after the form is filed,” SEC explains on its investor education website.
Shares of Bed Bath fell 15% to $19.57 in after-hours trading after Cohen’s revelation.
Cohen bought the shares between Jan. 13 and March 3 and disclosed a 9.8 percent stake in a March 6 letter to the board. He urged the company to find a more targeted strategy, as well as to continue selling its buybuy Baby chain. The retailer said on March 25 that it would then add three board members selected by Cohen reaching a deal with the activist.
Bed Bath & Beyond
said in a statement that it was pleased when it reached its deal with Cohen in March and that it is working to increase liquidity and improve operations to win back customers, among other efforts.
Bed Bath said it would provide an update on efforts to strengthen its balance sheet at the end of the month.
Cohen could not immediately be reached for comment.
Bed Bath was one of the seven companies Barron’s identified last week because of his need to refinance his debt or take out more loans. The company said it has $1 billion in its revolving credit facility.
“We have already taken action on many fronts – including a reduction of at least $100 million [capital expenditure] against the company’s original plan,” a company representative said.
Shares of Bed Bath have soared in recent days amid enthusiasm on the infamous Reddit forum WallStreetBets. Short sellers looking to sell borrowed stock betting on Bed Bath’s price bumped high interest rates on loans in recent days.
Write to Connor Smith at [email protected]