A “Shop Closing” sign on the Buy Buy Baby store in Brooklyn, Latest York City, Monday, Feb. 6, 2023.
Stephanie Keith | Bloomberg | Getty Images
A shower in bed and more canceled Friday’s auction for its chain Buy Buy Baby after it failed to search out a buyer willing to maintain its stores open – but it isn’t over for the child retailer, CNBC has learned.
Bidders pulled out of the auction after deciding that the chain was now not value buying because its value had deteriorated a lot, but in line with two people near the case who weren’t authorized to debate it, there are still parties interested in its assets publicly.
While it could be unusual, Bed Bath & Beyond may still accept a suggestion for Buy Buy Baby early next week. The chain’s fate will only be finally selected Tuesday, when a court hearing is scheduled to approve the sale of Buy Buy Baby’s mental property to Dream on Me Industries. The company, a little-known Latest Jersey retailer and one in all Buy Buy Baby’s former suppliers, has agreed to purchase its trademark and digital assets for $15.5 million if no higher bids come forward.
Once considered the jewel within the crown of a failing Bed Bath & Beyond empire, the kids’s chain has been within the midst of a sale at its 120 stores since its parent company filed for bankruptcy protection on April 23.
Because the auction process dragged on and Buy Buy Baby’s inventory decreased, so did its value. One person said that nearly three months after the sale ended, there was little left to auction aside from the brand’s mental property.
“A lot of the value was within the mental property, especially at this stage of the method. One can imagine that three months ago, when fully functioning stores were up and running, this won’t have been the case,” the person said.
Over the past few weeks, Bed Bath & Beyond has repeatedly pushed back and split up its bankruptcy-led Buy Buy Baby auction process to secure higher bids and find an organization willing to maintain the stores open.
Last week, she scheduled an auction exclusively for Buy Buy Baby’s mental property and announced Dream on Me because the winner.
Bed Bath & Beyond scheduled a separate auction for Friday, where buyers could bid on the chain as a going concern, and noted that the Dream on Me listing might be replaced in the event that they received the next sale price.
Nonetheless, it canceled the auction late Thursday when those bids didn’t materialize, the spokesman said in a press release.
Go Global Retail, an investment brand represented by Ankura Capital Advisors, was interested in keeping around 75% of its Buy Buy Baby stores and had previously sought $50 million in additional capital to support its bid, CNBC previously reported. The company is already lively in the kids’s industry and currently owns a kid’s clothing company Janie and Jack. He declined to comment when contacted by CNBC.
Had the auction gone ahead, the bids would likely not have been much higher than the $15.5 million Dream on Me offered for the network’s mental property, because the only assets left were its employees, empty stores, leases and any remaining inventory, the source said.
Any company trying to take over will likely should close stores for a couple of months in order that they can restock and get them back up and running.
Last month, Overstock.com won an auction for the mental property and digital assets of Bed Bath & Beyond with a bid price of $21.5 million. He decided to alter his eponymous website name to Bedbathandbeyond.com.
It’s unclear what Dream on Me plans to do with Buy Buy Baby if it seems to be the final word winner. The company didn’t reply to requests for more information from CNBC.