WhatsNew2Day
Latest News And Breaking Headlines

New CFO appointed to beleaguered Bed Bath & Beyond after former exec suicide

Beleaguered business Bed Bath & Beyond has named Laura Crossen the company’s interim chief financial officer after Gustavo Arnal plunged to his death last week.

Arnal, 52, threw himself from the 18th floor of his Manhattan apartment after a lawsuit was lodged against him for insider trading. 

His suicide has added to a cloud of financial uncertainty for the company and further complicates its plans for a turnaround.

According to the New York City Police Department, Arnal was found unconscious with injuries showing he fell from the 57-story Jenga residential tower in Manhattan.

Bed Bath & Beyond has named Laura Crossen (pictured) the company's interim chief financial officer after Gustavo Arnal plunged to his death from his Manhattan apartment last week

Bed Bath & Beyond has named Laura Crossen (pictured) the company’s interim chief financial officer after Gustavo Arnal plunged to his death from his Manhattan apartment last week

Arnal, 52, was sued one week before he died for allegedly inflating the price of Bed Bath & Beyond shares in a 'get-rich-quick' scheme. His death was ruled suicide on Monday

Arnal, 52, was sued one week before he died for allegedly inflating the price of Bed Bath & Beyond shares in a 'get-rich-quick' scheme. His death was ruled suicide on Monday

Arnal, 52, was sued one week before he died for allegedly inflating the price of Bed Bath & Beyond shares in a ‘get-rich-quick’ scheme. His death was ruled suicide on Monday

The medical examiner’s office ruled Arnal’s death a suicide, and police said an investigation was underway.

The news of Arnal’s death landed just days after Bed Bath & Beyond said that it would close about 150 of its namesake stores and slash its workforce by 20 percent as it tries to fix its beleaguered business. 

The company also said last week it was considering selling more of its stock to shore up its finances and had lined up more than $500 million of new financing.

‘The underlying factors were bad before,’ said Allen Adamson, co-founder of marketing consultancy Metaforce. 

‘This (tragedy) just makes a difficult situation even worse.’

Arnal himself, who joined the company in May 2020 after holding senior executive jobs at Avon, Walgreens Boots Alliance and Procter & Gamble, was facing a lawsuit accusing him and activist investor Ryan Cohen of conspiring since March to boost the price of Bed Bath & Beyond shares and then dump the stock for a profit.

It also accused Cohen of making a false filing and manipulating the timing of disclosing the sale of most of his stock.

Pengcheng Si, who filed the lawsuit in August against Arnal, Cohen, Bed Bath & Beyond and its bankers, couldn’t be reached for comment on Tuesday.

Bed Bath & Beyond said it is in the early stages of evaluating the complaint, ‘but based on current knowledge the company believes the claims are without merit.’ 

It disclosed in a separate filing in August that Arnal sold about 55,000 shares for $1.4 million in six different transactions that still left him with more than 255,000 shares.

Arnal’s stock dump came the same day a 20-year-old college student made $110million by selling all of his Bed Bath and Beyond stock – but he did so just before the retailer’s stock price slumped 23 percent after its second-biggest shareholder indicated plans to sell his entire holding.

Jake Freeman, an applied mathematics and economics major at the University of Southern California, invested in nearly five million Bed Bath & Beyond shares at $5.50 a share in July, spending a total of $25 million with the help of a wealthy pharmaceutical investor uncle.

As a result, he became a minority shareholder by owning around six percent of America’s largest houseware goods specialty stores as it became the latest ailing retailer to see a surge in its value thanks to the ongoing ‘meme stock’ boom.

That sees amateur investors snap up stock in companies seen as past-their-best, helping to drive the share price up and making some lucky stockholders who sell at the right time millions of dollars.

Freeman, whose family resides in the New York City area, then roughly sold more than $130million worth of stock on August 16, similarly to Arnal, after the retailer’s stock price surged to $27 a share.

An applied mathematics and economics major at the University of Southern California, Jake Freeman, 20, made a $110million profit by selling all of his Bed Bath and Beyond stock on Tuesday, nearly a month after investing in five million company shares at $5.50 a share

An applied mathematics and economics major at the University of Southern California, Jake Freeman, 20, made a $110million profit by selling all of his Bed Bath and Beyond stock on Tuesday, nearly a month after investing in five million company shares at $5.50 a share

An applied mathematics and economics major at the University of Southern California, Jake Freeman, 20, made a $110million profit by selling all of his Bed Bath and Beyond stock on Tuesday, nearly a month after investing in five million company shares at $5.50 a share

Ryan Cohen (pictured) and Arnal were accused of conspiring since March to boost the price of Bed Bath & Beyond shares and then dumping the stock for a profit

Ryan Cohen (pictured) and Arnal were accused of conspiring since March to boost the price of Bed Bath & Beyond shares and then dumping the stock for a profit

Ryan Cohen (pictured) and Arnal were accused of conspiring since March to boost the price of Bed Bath & Beyond shares and then dumping the stock for a profit

Arnal's death was due to 'multiple blunt force trauma', a coroner concluded on Monday

Arnal's death was due to 'multiple blunt force trauma', a coroner concluded on Monday

Arnal’s death was due to ‘multiple blunt force trauma’, a coroner concluded on Monday 

Founded in 1971, Bed Bath & Beyond had for years enjoyed its status as a big box retailer that offered a vast selection of sheets, towels and gadgets unmatched by department store rivals.

It was among the first to introduce shoppers to many of today´s household items like the air fryer or single-serve coffee maker, and its 15 percent to 20 percent coupons were ubiquitous.

Bed Bath & Beyond will close 150 stores and lay off 20% of staff as sales plunge by a quarter

Retail chain Bed Bath & Beyond announced major layoffs late last month, as high inflation and a sagging economy hammer large US companies.

Bed Bath & Beyond, which has become the latest meme-stock darling for small traders on Reddit, announced plans to close 150 stores of its roughly 900 and lay off 20 percent of corporate and supply chain staff.

Sue Gove took over as interim CEO of Bed Bath & Beyond earlier this year

Sue Gove took over as interim CEO of Bed Bath & Beyond earlier this year

Sue Gove took over as interim CEO of Bed Bath & Beyond earlier this year

The big-box chain – once considered a so-called ‘category killer’ in home and bath goods – has seen its fortunes falter, with CEO Mark Tritton fired in June after sales plunged 25 percent in the first quarter. 

The company hired Sue Gove, an independent board director, to replace him on an interim basis.

Gove said the retailer was ‘continuing to see significant positive momentum’ and intended to build its ‘deep heritage as a retailer.’

‘While there is much work ahead, our road map is clear and we’re confident that the significant changes we’ve announced today will have a positive impact on our performance’ she said on a conference call. 

But for the last decade or so, Bed Bath & Beyond struggled with weak sales, largely because of its messy assortments and lagging online strategy that made it hard to compete with the likes of Target and Walmart, both of which have spruced up their home departments with higher quality sheets and beddings. 

Meanwhile, online players like Wayfair have lured customers with affordable and trendy furniture and home décor.

In late 2019, Bed Bath & Beyond tapped Target executive Mark Tritton to take the helm and turn around sales. 

Tritton quickly scaled back coupons and started to introduce store label brands at the expense of national labels.

But the pandemic, which happened shortly after his arrival, forced the retailer to temporarily close its stores and it was never able to use the health crisis to pivot to a successful online strategy as others had, analysts said. 

And while many retailers were grappling with supply chain issues, Bed Bath was among the most vulnerable.

During last year’s crucial holiday shopping season, the stores were missing many of their 200 best-selling items, including kitchen appliances and personal electronics, taking a hit of $100 million in sales, the company said early this year. 

The retailer ousted Tritton in June after two back-to-back quarters of disastrous sales.

‘He went too far, too fast,’ said Neil Saunders, managing director at GlobalData Retail. 

‘He didn’t think about the customer.’

Then came turbulence with the retailer’s shares, which made a monstrous run from $5.77 to $23.08 in a little more than two weeks in August. 

The trading was reminiscent of last year’s meme-stock craze, when out-of-favor companies suddenly became darlings of smaller-pocketed investors.

But the stock fell back to earth after Cohen, the billionaire co-founder of online pet-products retailer Chewy Inc. who purchased a nearly 10% stake in Bed Bath & Beyond in March, sold off all his shares.

The company is now being led by board member and retail consultant Sue Gove while a search firm looks for a permanent CEO.

Last week, it announced that the chief operating officer and chief stores officer had left. 

The city's EMS officials responded to the incident and were seen carrying the man's body off in a black body bag

The city's EMS officials responded to the incident and were seen carrying the man's body off in a black body bag

The city’s EMS officials responded to the incident and were seen carrying the man’s body off in a black body bag

Arnal (right) is accused of providing misleading statements and omissions to the public in order to keep the share prices high. He is here pictured with his family

Arnal (right) is accused of providing misleading statements and omissions to the public in order to keep the share prices high. He is here pictured with his family

Arnal (right) is accused of providing misleading statements and omissions to the public in order to keep the share prices high. He is here pictured with his family

Shares of the company fell more than 17 percent in afternoon trading, to $7.12 and have lost nearly 70 percent of their value in the past 52 weeks

Shares of the company fell more than 17 percent in afternoon trading, to $7.12 and have lost nearly 70 percent of their value in the past 52 weeks

 Shares of the company fell more than 17 percent in afternoon trading, to $7.12 and have lost nearly 70 percent of their value in the past 52 weeks

On Wednesday, Gove said the retailer was ‘continuing to see significant positive momentum’ and intended to build its ‘deep heritage as a retailer.’

‘While there is much work ahead, our road map is clear and we’re confident that the significant changes we’ve announced today will have a positive impact on our performance’ she said on a conference call.

The retailer also announced a plan to raise money by issuing new shares and said it had secured $500 million in new financing — but investors took a dim view of the strategic plan, and shares fell as much as 25 percent in morning trading.

Traders on the Reddit forum WallStreetBets, who have cheered the stock in recent weeks, reacted with a mixture of stoicism and despair.

‘I just wanted make money without any effort. why I have to suffer like this? why?’ wrote one user on the forum.

In Wednesday’s update, Bed Bath & Beyond also forecast a bigger-than-expected 26 percent slump in same-store sales for the second quarter and said it would now retain its buybuy Baby business, which it had put up for sale.

Meanwhile, Crossen will continue as principal accounting officer while serving as interim CFO.

Bed Bath & Beyond executives say they are reverting back to the company’s original strategy of focusing on national brands instead of its own private labels, getting rid of one-third of its store brands. 

It would also stop embracing the ‘pile high’ merchandising approach and work more closely with its suppliers.

But Saunders and other analysts fear that suppliers will demand stricter financial terms as they worry about the health of the company. 

He thinks that the company is just biding time before a bankruptcy filing.

Shares of the company fell more than 17 percent in afternoon trading, to $7.12. 

Shares have lost nearly 70 percent of their value in the past 52 weeks.  

The national suicide and crisis lifeline is available by calling or texting 988. There is also an online chat at 988lifeline.org.

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More