The Purchase Purchase Child public sale has been canceled however bidders stay
“Store Closing” signs at a Buy Buy Baby store in the Brooklyn borough of New York, on Monday, February 6, 2023.
Stephanie Keith | Bloomberg | Getty Images
bed bath beyond The company canceled a Friday auction for its Buy Buy Baby chain because it had failed to attract a buyer willing to keep its businesses afloat – but it’s not quite over for the baby retailer, eh CNBC learned.
Bidders withdrew from the auction after realizing the chain was no longer worth buying because its value had dropped so much. But there are still parties interested in their assets, according to two people familiar with the matter who were not authorized to speak about it publicly.
While it would be unusual, Bed Bath & Beyond could still accept a Buy Buy Baby offer early next week. The chain’s fate will not be finally settled until Tuesday, when a court hearing is scheduled to authorize the sale of Buy Buy Baby’s intellectual property to Dream on Me Industries. The company, a little-known New Jersey-based retailer and one of Buy Buy Baby’s former suppliers, agreed to buy its brand and digital assets for $15.5 million if no higher bids are received.
The baby chain, once considered the crown jewel of the now-defunct Bed Bath & Beyond empire, has been in the midst of liquidation sales at its 120 stores since its parent company filed for bankruptcy on April 23.
As the auction process dragged on and Buy Buy Baby’s inventory dwindled, so did its value. Nearly three months after closing the sale, there is little left to offer apart from the brand’s intellectual property, said one respondent.
“The greatest value was in intellectual property, especially at this point in the process. One can imagine that this might not have been the case three months ago when the stores were still fully operational and operating,” the person said.
Over the past few weeks, Bed Bath & Beyond has repeatedly pushed back and split up the ailing Buy Buy Baby auction process to get higher bids and find a company willing to keep the business afloat.
Last week an auction was held exclusively for Buy Buy Baby intellectual property and Dream on Me was announced as the winner.
Bed Bath & Beyond scheduled a separate auction for Friday for buyers to bid on the chain as a going concern, noting that Dream on Me’s bid could be evicted if they were awarded a higher selling price.
However, the auction was halted late Thursday as those bids failed to materialize, a spokesman said in a statement.
Go Global Retail, a branded investment firm represented by Ankura Capital Advisors, was interested in keeping about 75% of Buy Buy Baby’s stores operating and had previously sought $50 million in additional capital to to back up his offer, CNBC previously reported. The company is already in the baby business and currently owns children’s clothing company Janie and Jack. When asked by CNBC, it declined to comment.
If the auction had taken place, the bids likely would not have been much higher than the $15.5 million Dream on Me bid for the chain’s intellectual property, given that the only other assets remaining were its employees, stores, leases and remaining stock were empty, the source said.
Any company ready to take over will likely have to close stores for a couple of months to allow them to replenish inventory and get back up and running.
Last month, Overstock.com won the auction for Bed Bath & Beyond’s intellectual property and digital assets with a bid price of $21.5 million. It was decided to change the name of the website of the same name to Bedbathandbeyond.com.
It’s not clear what Dream on Me plans to do with Buy Buy Baby if it ends up victorious. The company did not respond to CNBC’s requests for more information.