JULY 26, 2023 UPDATE: Dream on Me has confirmed that it has purchased the rights to 11 BuyBuy Baby store leases. The price was $1.17 million, according to CNBC. A court hearing to finalize the purchase is scheduled for July 28, 2023. “Based on the final store count, we would like to open the stores back as soon as possible,” said a Dream on Me spokesperson via email.
UPDATE: A U.S. Bankruptcy Court judge for the District of New Jersey approved Dream on Me’s purchase of BuyBuy Baby’s trademark and digital assets for $15.5 million, according to court documents. Dream On Me, a former BuyBuy Baby vendor, was the stalking horse bidder for the assets.
Dream on Me will now acquire all of BuyBuy Baby’s intellectual property, including digital properties, mobile platform, business data and advertising and marketing assets. Everyday Health Media LLC submitted the next highest or otherwise best bid, and will acquire the assets instead if the Dream On Me deal falls through.
Bed Bath & Beyond has reportedly ceased its efforts to find an acceptable buyer for BuyBuy Baby’s store footprint and will instead seek court approval for a more limited sale of the baby retailer’s IP assets, according to multiple media reports.
The retailer had previously pushed the date for BuyBuy Baby’s auction from June 21 to June 29. At that point, New Jersey-based baby retailer Dream On Me emerged as the lead bidder for the brand’s IP, with a $15.5 million bid for assets including the brand name, sales data, websites and mobile apps. However, Dream On Me expressed no interest in acquiring BuyBuy Baby’s physical footprint, and so a second auction was set for July 7.
Bed Bath & Beyond was seeking a higher offer during the latter auction, which could have included bids for BuyBuy Baby’s IP assets alongside its stores, but no bids emerged that were higher than Dream On Me’s. Bed Bath & Beyond is expected to seek approval for the sale of BuyBuy Baby’s IP to Dream On Me on July 11.
Bed Bath & Beyond has been in and out of talks with potential suitors to purchase BuyBuy Baby since at least mid-2022, when RC Ventures, the venture capital fund of Chewy Co-founder Ryan Cohen, pushed for a sale. RC Ventures believed that BuyBuy Baby had a market value of approximately $1.3 billion as of April 22, 2022.
Overstock emerged as the winner of Bed Bath & Beyond’s own IP in late June with a $21.5 million bid. The online home goods and furnishing retailer will rebrand itself as Bed Bath & Beyond in order to shed its reputation as a liquidator, a format the retailer hasn’t operated under in years.
“We have a little bit of headwind with customers and we have a little bit of headwind with suppliers, given our name,” said Jonathan Johnson, CEO of Overstock in an interview with Retail TouchPoints. “Bed Bath & Beyond, on the other hand, is a great name which proved to be not as good a business model. When we saw ‘good name, bad business model,’ and ‘good business model, bad name,’ dropping the two bad things and putting the two good things together made a lot of sense.”