Bed Bath & Beyond surged in premarket trading Monday after it was revealed that Ryan Cohen, the Chairman of GameStop, had a nearly 10% stake in the retailer.
In a letter to Bed Bath's board, Cohen wrote that he believes the retailer is struggling to reverse market share losses and navigate supply chain troubles. Bed Bath Chief Executive Mark Tritton was criticized for reaping excessive compensation during periods of under performance.
Cohen said Bed Bath needs to narrow its focus to fortify operations and maintain the right inventory mix to meet demand, while simultaneously exploring strategic alternatives that include separating Buy buy Baby and a full sale of the company.
Bed Bath said it received a letter on Sunday evening, but had no prior contact with RC Ventures.
Bed Bath said in a statement that they will carefully review their letter and hope to engage with the ideas they have put forth.
Cohen's push for changes at Bed Bath comes after the retailer settled a months-long spat with a trio of activist investors. Bed Bath was criticized by the activist group for its e-commerce presence.
After the settlement was reached, the retailer brought on Tritton, a former Target executive. The appointment of Tritton gave hope to investors that a revival was in the works.
Since taking the helm of the company, Tritton has embarked on closing hundreds of Bed Bath locations, selling non-core assets including Cost Plus World Market and Christmas Tree Shops, ramping up stock purchases, debuting numerous private labels, and more recently navigating Bed Bath through
Bed Bath'sscattershot strategy isn't working according to Cohen. The company could be better suited with a private equity owner.
Bed Bath shares have fallen in the last year.
There is a developing story. You can check back for updates.
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