Believe it or not, Bed Bath & Beyond (OTCMKTS:BBBYQ) remains in the spotlight even though the retailer has filed for bankruptcy. For instance, those interested in BBBYQ stock are keeping an eye on July 11.
That’s as the retailer seeks approval for the sale of its intellectual property from its Buy Buy Baby business. Dream On Me is looking to purchase the IP for $15.5 million at a court hearing on July 11.
The retailer has gone this route — selling off pieces of the business — as an auction for its entire Buy Buy Baby business has failed to gain traction. According to Reuters:
“Bed Bath & Beyond had declared Dream On Me as lead bidder for the brand’s intellectual property on June 29, but had continued to seek buyers who would take over the entire Buy Buy Baby business. But no bidder offered a higher or better bid than Dream on Me’s proposal, so Bed Bath & Beyond canceled an auction that had been scheduled for Friday, according to a notice filed Thursday night in New Jersey bankruptcy court.”
Included in the $15.50 million IP purchase is the company’s brand name (Buy Buy Baby), as well as its sales data, websites and mobile apps.
What’s Left of BBBYQ Stock?
This deal is similar to the one that Bed Bath & Beyond struck for its own brand name. That’s when it made an intellectual property sale to Overstock (NASDAQ:OSTK).
As we previously reported, Overstock had “emerged as the stalking horse bidder in the company’s bankruptcy proceedings. Overstock is offering the company $21.5 million for a portion of its assets.”
The company was “bidding for intellectual property (IP) assets, ‘including the rights to collect royalties and other proceeds and payments in connection [to] the business.’ The bid also includes Bed Bath’s internet and mobile properties, marketing materials, data and additional assets.”
It has not been a fun run for BBBYQ stock bulls. That is, unless you are considering the recent price action.
In late June, the stock pieced together a four-day rally, climbing more than 120% at one point. From the May low to last month’s high, BBBYQ stock has jumped more than 700%.
That said, shares have been crushed overall. Even with the recent rally, shares are still down about 90% this year. From the February high, BBBYQ stock is down more than 96%.
While Bed Bath & Beyond shares were once a favorite holding among short-squeeze momentum traders, that momentum is gone. AMC Entertainment (NYSE:AMC) and GameStop (NYSE:GME) were some other favorites among momentum traders. However, Bed Bath & Beyond simply couldn’t hold up amid its continuously deteriorating financials.
On the date of publication, Bret Kenwell did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
