Continuing in its quest to slim down as a company, Bed Bath & Beyond (NASDAQ:BBBY) has reached agreement to sell a major asset -- bargain food and home furnishings retailer Cost Plus World Market, which will be purchased by privately held Los Angeles private equity firm Kingswood Capital Management.
The price of the deal was not disclosed. It covers 243 Cost Plus brick-and-mortar stores, the retailer's e-commerce site, a pair of distribution centers, and its corporate office in Alameda, California.
The sale is subject to compliance with antitrust law. Bed Bath & Beyond expects it will close before the end of its 2020 fiscal year, which completes in February. Cost Plus should continue to operate as a standalone brand.
Bed Bath & Beyond is currently in the final stages of a multiyear effort to trim its once-sprawling portfolio in the hopes of cutting costs and becoming more consistently profitable. It has sold numerous assets smaller than Cost Plus in this drive, including Christmas Tree Shops and One Kings Lane.
As a victim of the retail apocalypse, the company remains burdened by a large brick-and-mortar footprint and has many competitors in the online space for the types of goods it sells.
Nevertheless, "We've taken deliberate steps throughout the year to streamline our portfolio and fortify our strategic focus in Home, Baby, and Beauty & Wellness, and today's announcement represents the conclusion of this work," CEO Mark Tritton was quoted as saying.
The company also provided a bigger carrot for its investors, in announcing that it has expanded its authorization for share buybacks. The company's accelerated share repurchase program can now top out at $825 million over the next three years, up from the previous $675 million.