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Bed Bath & Beyond shares jump after deal with activist investor Ryan Cohen

A person walks into a Bed Bath & Beyond store on October 1, 2021 in the Tribeca neighborhood of New York.

Michael M. Santiago | Getty Images

Bed Bath & Beyond announced on Friday that it had reached an agreement with activist investor Ryan Cohen, sending the company’s shares up nearly 10% in premarket trading.

The home goods retailer said in a press release that three people selected by Cohen’s company, RC Ventures, would immediately join Bed Bath’s board as independent directors. They include Marjorie Bowen, Shelly Lombard and Ben Rosenzweig.

The company said a four-person committee will review alternatives for its Buybuy Baby channel and make recommendations to the board. This committee will include Bowen and Rosenzweig.

Bed Bath has been in the midst of a turnaround effort led by former Target executive Mark Tritton, who took the helm in 2019. This has included an overhaul of many aspects of the store, including a stronger focus on the private label.

Earlier this month, Cohen, who is also president of GameStop, revealed a nearly 10% stake in Bed Bath and his intentions to push the retailer to make sweeping changes. In a letter, he criticized Bed Bath executives for racking up high salaries while struggling to turn around the retailer’s performance. He called for an overhaul of his operations, including a closer look at whether to spin off or sell his chain of baby stores.

On Friday, Tritton said company executives “look forward to incorporating the ideas of our new directors to drive our continued transformation” as part of the deal with RC Ventures.

“As we move forward, our goals will continue to focus on creating value for our shareholders, improving experiences for our customers, implementing transformation across our business, and creating new exciting opportunities for our dedicated employees across all of our banners,” he said. said in the press release.

Cohen called the resolution “a positive outcome for all Bed Bath shareholders.”

“I appreciate that management and the board have been willing to quickly embrace our ideas and I look forward to supporting them in the coming year,” he said in the press release. .

This story is developing. Please check for updates.

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