Bed Bath & Beyond looking to drum up $$$ and reset loan terms
Union, N.J. – Bed Bath & Beyond is making an offer it hopes investors won’t refuse.
Seeking to unearth more than $1 billion in new cash, the company late this afternoon announced a proposed offering of shares of its Series A convertible preferred stock, warrants to purchase shares of Series A convertible preferred stock and warrants to purchase the company’s common stock.
If that offering closes, BBB will be able to amend its credit agreement to waive any outstanding defaults or events of default under its existing credit facilities. The closing would also unleash an additional $100 million of loans from Sixth Street Specialty Lending, Inc., its FILO agent.
The company plans to combine the net proceeds from the initial closing of the offering with the $100 million to cover a missed interest payment on its senior notes by March 3. Last week, Bed Bath & Beyond failed meet the Feb. 1 deadline for an interest payment of nearly $30 million on more than $1 billion in notes. The action triggered a 30-day grace period to get square.
The amendment would also decrease Bed Bath’s total revolving commitment from $1.13 billion to $565 million. On Jan. 25, BBB received a notice of default and a request for immediate payment on its asset-backed loans from JP Morgan, which is the administrative agent under the company’s credit facility.
At the time, the company informed the SEC that it did not have sufficient resources to repay what it owed on its credit facilities.