Overstock.com Is Changing Name To Bed Bath & Beyond Name After Buying Its Assets Last Week
Key takeaways
- Overstock is shedding its name to become Bed Bath & Beyond, which it bought for $21.5 million last week
- The ailing retailed filed for bankruptcy in April, with Overstock snapping up the IP and online business
- Investors liked the growth opportunity, with Overstock’s share price lifting 6.5% on Friday
Overstock is officially no more — or the brand name, that is. It’s taking on Bed Bath & Beyond’s brand instead, which it thinks is more recognizable as it looks to capture new market share as a combined household goods retailer. Investors liked the move — we’ve got the latest below.
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What’s happening with Bed Bath & Beyond?
After the retailer declared bankruptcy, e-commerce giant Overstock.com purchased Bed Bath & Beyond for just $21.5 million last week. Overstock now owns all of the once-popular store’s trademarks, patents and website domains.
Overstock didn’t buy Bed Bath & Beyond’s bricks and mortar stores, another sign that online shopping is marching forward as physical stores are on the way out. All branches will close as planned as the brand moves online.
It’s pretty unusual for a parent company to rebrand to its subsidiary, but that shows the strength of the beloved Bed Bath & Beyond brand name — which Overstock CEO, Jonathan Johnson, mentioned in his statement. “The combination of our winning asset-light business model and the high awareness and loyalty of the Bed Bath & Beyond brand will improve the customer experience and position the company for accelerated market share growth”, he said.
Wall Street’s reaction
Investors responded positively to the news, with Overstock’s share price climbing over 6.5% on Friday. The stock has skyrocketed 72% this year so far and if Overstock can turn around the ailing Bed Bath & Beyond business, it could stand to make a fortune from its $21.5 million investment.
One of the key parts of the acquisition was Bed Bath & Beyond’s customer list, which Johnson estimates to be double the size of Overstock’s. If Overstock can capture some of that list, it could turn around the company’s fortunes after it posted a surprise loss for its Q4.
The bottom line
Overstock may have just made the purchase of a lifetime, and capitalizing on a much-loved brand name is looking like a smart play from the company. Investors will be watching to see if the bolshy move translates to increased sales before they hedge their bets.
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