-Bed Bath & Beyond said on Friday it appointed three new directors to its board as part of its settlement with GameStop’s Ryan Cohen, weeks after the billionaire investor pushed for changes at the home goods retailer.
Shares of New Jersey-based Bed Bath & Beyond rose 5%, after the company added two of the directors would join a committee focused on exploring options for buybuy Baby, selling which Cohen believes would improve the company’s focus.
The shares have surged ~37% since Cohen disclosed his nearly 10% stake in the company, taken through his investment firm RC Ventures LLC, and urged it to explore alternatives including separating buybuy Baby chain or a sale of the entire company.
The activist investor has criticized the retailer for an “overly ambitious” strategy, overpaying top executives and failing to reverse market share losses.
In recent months, the company has buckled under pressure from supply chain issues and competition and seen its sales plunge in two of the three quarters reported last year.
It is the second time the company has come under pressure from activist investors. In 2019, it reached a settlement with three activists and appointed four new directors, after the group criticized it for failing to reshape itself to meet consumers’ growing preferences to shop online.
Cohen noted earlier that Bed Bath & Beyond Chief Executive Officer Mark Tritton, who was hired soon after the 2019 settlement, was paid far more than what top bosses earned at far bigger retailers including Macy’s, Kohl’s, and Dollar Tree.
Bed Bath & Beyond’s board will temporarily expand to 14 members before reverting to 11 following the annual meeting, the company said in a statement on Friday.
Cohen’s investment vehicle RC Ventures did not immediately respond to a Reuters request for comment.
(Reporting by Deborah Sophia in Bengaluru; Editing by Shinjini Ganguli)
