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Good morning,
Mattress Bathtub & Past Inc., ranked no. 381 on the Fortune 500, is within the midst of meme inventory mayhem, dire monetary straits, government upheaval, controversy, and tragedy.
Over the Labor Day weekend, the retailer announced that its CFO Gustavo Arnal, 52, handed away, stating the group is “profoundly saddened by this surprising loss.” Native studies confirmed that Arnal fell to his death on Sept. 2 from a Manhattan skyscraper. His demise was then ruled a suicide on Monday by New York Metropolis’s medical expert. Arnal joined the corporate in Might 2020 following a profession in finance at Avon, Walgreens Boots Alliance, and Procter & Gamble.
“Laura Crossen, Mattress Bathtub & Past’s chief accounting officer, will assume the function of interim chief monetary officer,” an organization consultant instructed me in an electronic mail on Tuesday. “Laura has been with the group for greater than 20 years and we’re grateful for her management. She has the total assist of the group, the board, and our exterior advisors.”
The corporate filed a Kind 8-Okay with the Securities and Alternate Fee naming Crossen the interim CFO. In accordance with the report, her base wage will improve by $200,000, with a rise of her goal annual bonus alternative to 70%.
I requested Mattress Bathtub & Past what Crossen’s priorities could be moving into the CFO function. “Our management crew, together with Laura, is concentrated on supporting our groups, ensuring our shops, clients and companions are supported and advancing the methods shared final week,” in line with the consultant.
Mattress Bathtub & Past announced on Aug. 31 that it had secured greater than $500 million in new financing, deliberate to chop its workforce by 20% and shut 150 “lower-producing” shops. The corporate additionally stated it had eradicated the chief working officer and chief shops officer roles. Mattress Bathtub & Past reported in earnings ending Might 28 a net loss of $385 million, in comparison with a lack of $51 million the identical time final 12 months. Sue Gove, an impartial director on the firm, became interim CEO, changing Mark Tritton as CEO.
Along with monetary challenges, a category motion lawsuit was filed within the U.S. District Court docket for the District of Columbia on Aug. 23, itemizing the lead plaintiff as Pengcheng Si. It alleges that from March 2022 by means of August 2022, Arnal; Ryan Cohen, an activist investor; JP Morgan Securities LLC; and others, “engaged in a fraudulent scheme to artificially inflate the worth of BBBY publicly traded inventory,” according to the court filings I reviewed.
“As beforehand famous in our 8-Okay filed Aug. 31, the corporate is within the early levels of evaluating the grievance however primarily based on present data, the corporate believes the claims are with out benefit,” the Mattress Bathtub & Past consultant instructed me.
Here is what we all know concerning the chaotic summer season previous this previous weekend’s tragedy:
Aug. 16—Bed Bath & Beyond shares jump as much as 78.8% after legendary meme stock investor’s latest bet: BBBY surged greater than 70% on Aug. 16 as retail buyers on social media gravitated to the inventory after a submitting revealed activist investor Ryan Cohen was holding regular on his guess.
Aug. 16—How a 20-year-old USC student netted $110m from a Bed Bath & Beyond stock dump at exactly the right time: By 2 p.m. ET on Aug. 16, the share value of BBBY dropped from greater than $26 a share to beneath $20 in a matter of minutes. However the 20-year-old USC scholar posted on Reddit that he had exited his $130 million place earlier than midday.
Aug. 18—Ryan Cohen drives a 27% drop in Bed Bath & Beyond shares by selling his entire stake: 5 months after disclosing a stake in Mattress Bathtub & Past, activist shareholder Cohen tapped out, sparking a selloff within the shares of the house items retailer.
Aug. 19—Bed Bath & Beyond shares plummet another 43% after Cohen exits the company: Shares of BBBY nosedived 43% at market open on Aug. 19, as buyers fled following information that GameStop chairman Ryan Cohen had certainly offered all of his holdings within the meme inventory.
Aug. 19—Some Bed Bath & Beyond suppliers halt shipments on unpaid bills: A number of of the corporations that present credit score insurance coverage or short-term financing to distributors revoked protection of the corporate.
Aug. 19—No respite for meme stock investors as Bed Bath & Beyond worries whether it can pay its bills: Only a day after its market cap misplaced a fifth of its worth following a large run-up in value, the meme inventory well-liked on Reddit board WallStreetBets was set to plunge.
Aug. 22—Bed Bath & Beyond leads rout in meme stocks as mania fizzles: BBBY tumbled 16%, marking a three-day drop that erased 60% of its market worth, after a report some suppliers have been limiting or halting shipments altogether after the corporate fell behind on funds.
Aug. 23—A class action lawsuit filed in the U.S. District Court for the District of Columbia: Lead plaintiff Pengcheng Si alleges Ryan Cohen approached Gustavo Arnal a few plan to manage shares of the corporate so they might each revenue.
Aug. 24—Bed Bath & Beyond shares soar once again after it taps a new financing source: A report revealed the troubled residence items retailer has secured debt financing. The debt financing course of is being carried out by JPMorgan Chase.
Aug. 31—Bed Bath & Beyond shares are plunging on its plans to close 150 stores: Merchants on Reddit’s r/WallStreetBets discussion board have been hit particularly exhausting, with one claiming to have realized a $1.1 million net loss with their funding.
If you happen to or somebody you understand is considering suicide, you’ll be able to contact the Nationwide Suicide Prevention Lifeline by dialing 988 or 1-800-273-8255.
See you tomorrow.
Sheryl Estrada
sheryl.estrada@fortune.com
Upcoming occasions: This month, the Fortune CFO group will meet in individual in Chicago and Dallas for 2 in-depth dinner conversations to delve into the brand new management methods CFOs should embrace. CFOs, click here to apply to hitch us in Chicago at Sepia on September 22 or click here to apply to hitch us on September 29 at The Mansion Turtle Creek in Dallas. Please word that attendance is complimentary and topic to approval. See you there!
This story was initially featured on Fortune.com