In a letter sent to Bed Bath & Beyond Inc., Cohen said that declining sales can no longer be blamed on the COVID-19 pandemic, noting that other national chains are seeing sales near or exceed pre-pandemic levels. Bed Bath & Beyond has lost money for three consecutive years.
Cohen suggests in the letter the possible sale of part or all of the Union, New Jersey, company. One part of the business that could be sold or spun off, according to Cohen, is the Buy Buy Baby chain. Any money obtained from a full or partial sale could be used to pay off debt, put cash on the balance sheet and lower debt, creating more shareholder value, Cohen said.
“The past 10 years have shown that Bed Bath faces a difficult existence in the public market. The market is not giving the company nearly enough credit for (Buy Buy Baby’s) value,” Cohen wrote. “A sale that can lock in a substantial premium for shareholders and provide Bed Bath the flexibility of the private market could be an ideal outcome for customers, employees and investors.”