Mattress Bathtub & Past—which raised greater than $1B in an fairness providing of most well-liked inventory earlier this month that enabled the retailer to keep away from chapter—has notified an Ontario court docket that the infusion of capital is not going to be sufficient to allow the corporate to maintain working in Canada.
Mattress Bathtub & Past Canada (BBB Canada) informed the court docket in filings that it’s “bancrupt” and has “reluctantly concluded” that the fairness providing didn’t elevate sufficient capital to restructure its US shops and produce its Canadian enterprise again to profitability.
The court docket statements, which have been posted on the web site of Alvarex and Marsal—consultants who have been appointed by the court docket as a monitor of BBB Canada—additionally mentioned the retailer’s Canadian shops wouldn’t be worthwhile if spun off as a standalone enterprise.
The retail chain mentioned it’ll shut its 54 Mattress Bathtub & Past shops and 11 Buybuy Child shops in Canada. The corporate mentioned it’ll undertake “an orderly liquidation” of its remaining stock on the Canada places, “with help from a third-party skilled liquidator and vacate its leased retail shops and premises,” in keeping with a report in Chain Retailer Age.
The retailer additionally supplied the court docket with what it known as a “strategic replace” that clarified the scope of the corporate’s restructuring of its retail footprint within the US, a collection of “incremental” retailer closures that may cut back the corporate’s portfolio from the 762 shops that have been working in November to 480.
The restructured US operation will embody 360 Mattress Bathtub & Past shops and 120 Buybuy shops, the corporate mentioned. Final week, the agency mentioned it was shutting its Harmon cosmetics chain and shutting 150 “lower-producing” Mattress Bathtub & Past shops.
“In response to evolving buying preferences at this time, this goal retailer base consists of the corporate’s most worthwhile places and finest geographic presence for purchasers that may allow an optimum omni-experience,” the corporate mentioned, including that its digital channel is generate a better proportion of gross sales.
The court docket filings in Ontario have been made after Mattress Bathtub & Past’s Canadian division filed for cover below Canada’s model of Chapter 11, referred to as the Corporations’ Collectors Association Act.
“The wind-down course of have to be commenced as quickly as potential to maximise recoveries and restrict prices by making certain that BBB Canada can exit from all retail shops as quickly as practicable and keep away from additional lease, worker prices, crucial provider/service supplier charges, financial institution charges and different ongoing quantities,” the retailer mentioned in its court docket filings.
Final week, Mattress Bathtub & Past accomplished an fairness providing that raised about $225M in money, with an extra $800M that may are available future installments. The corporate additionally secured a $100M mortgage from Sixth Avenue companions, CSA reported.
In its “strategic replace,” Mattress Bathtub & Past mentioned it’ll pursue “asset-light” stock administration methods, together with vendor-direct-to-consumer and market gross sales.
