Do Bed Bath & Beyond’s directors know something that we don’t?
In filings with the Securities and Exchange Commission posted on the retailer’s website after the close of trading on Tuesday, eight of the nine members of its board of directors sold more than 342,000 shares last Friday.
According to the filings, the sales leave many of the directors without any shares in the company while for others the sales represent a substantial share of their previous holdings.
With rumors swirling around that the retailer is on the brink of bankruptcy and has retained at least three legal and advisory firms that specialize in financial reorganizations, it could signal that filing is imminent. Usually in a chapter 11 bankruptcy the value of current shareholder’s holdings are reduced to little or nothing as debtors and others take control of the company. Even worse, in a possible liquidation the shares would also be virtually worthless.
The only director not to sell shares according to the SEC filings is Sue Gove, who is the CEO.
Bed Bath could not be reached for comment and has previously not commented on matters related to its current financial standing.
The sales, which were all executed on the first day they could legally be sold, on Jan. 20, are as follows:
Harriett Edelman: Sold 52,245 shares, retains 73,789 shares.
(Note: Edelman is also the chair of the board.)
Jeff Kirwan: Sold 42,041 shares, retains 43,455 shares.
Ann Yerger: Sold 42,041 shares, retains 37,424 shares.
Joshua Schechter: Sold 42,041 shares, retains 35,087 shares.
Andrea Weiss: Sold 42,041 shares, retains 27,096 shares.
Shah Minesh: Sold 42,041 shares, retains no shares.
Marjorie Bowen: Sold 40,000 shares, retains no shares.
Shelly Lombard: Sold 40,000 shares, retains no shares.
On January 20, Bed Bath stock traded at around the $3.40 level and it closed today just below that at $3.39. It is not known exactly how much the eight board members cleared from these sales, which appear to be shares they received as part of their compensation as directors. Given the $3.30 closing price for the day the sales could have ranged from $132,000 to just over $171, 500. Several days earlier shares traded as high as $5.22 on speculation that it was avoiding bankruptcy through a possible sale or other measures.