The Chapter 11 proceedings will enable the retailer to scale down its businesses while conducting a limited sale and marketing process for some or all of its assets.
The company said it has received a commitment of approximately $240m in debtor-in-possession financing from Sixth Street Specialty Lending.
Bed Bath & Beyond plans to leverage this funding to provide the liquidity required to support operations during the process.
Meanwhile, the retailer will continue to operate its 360 Bed Bath & Beyond and 120 buybuy BABY stores, as well as its digital platform as it initiates store closure and assets liquidation.
In addition, the retailer has filed motions in New Jersey bankruptcy court seeking permission to auction the two brands.
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Bed Bath & Beyond president and CEO Sue Gove said: “Millions of customers have trusted us through the most important milestones in their lives – from going to college to getting married, settling into a new home to having a baby.
“Our teams have worked with incredible purpose to support and strengthen our beloved banners, Bed Bath & Beyond and buybuy BABY. We deeply appreciate our associates, customers, partners and the communities we serve, and we remain steadfastly determined to serve them throughout this process. We will continue working diligently to maximise value for the benefit of all stakeholders.”
Kirkland & Ellis and Cole Schotz P.C. acted as the legal counsel while AlixPartners LLP serves as financial advisor for Bed Bath & Beyond.
In January 2023, the homeware retailer reported that its net sales for the third quarter of fiscal 2022 declined by 33% to $1.259bn.
The retailer raised around $225m in an equity offering in February 2023 to prevent bankruptcy.
Earlier this month, Bed Bath & Beyond’s former CEO Mark Tritton sued the company over the issue of unpaid severance.