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Bed Bath & Beyond (Nasdaq: BBBY) inked a cooperation agreement with activist investor Ryan Cohen and his firm RC Ventures immediately adding his three nominees to the retailer's board.
Why it's the BFD: The last time the home goods retailer settled with activists (Legion Partners, Macellum Advisors and Ancora Advisors) it eventually led to a shakeup of the management team, including the installation of CEO Mark Tritton.
- And then the sale of Cost Plus World Market, Christmas Tree Shops and Personalization Mall.
Details: As part of the agreement, the company has named a four-person committee to look at strategic alternatives for its Buybuy Baby banner, a business that could be sold.
Of note: RC Ventures beneficially owns 9.8% of the company's outstanding common shares.
Between the lines: The new directors include Marjorie Bowen, Shelly Lombard and Ben Rosenzweig.
- They will also stand for election on the company's slate at the annual shareholders meeting this year.
- The board will temporarily expand to 14 members, but then revert back to 11 following the vote.
- RC Ventures will abide by a standstill agreement and support the company's full slate of directors.
The bottom line: "Our buybuy BABY business is a tremendous asset, and we are committed to unlocking its full value," said Tritton in a statement.
