🩳 R Fuk
BBBY has come to an agreement with a yet-to-be-announced investor for over $1b in preferred convertible stock + warrants to avoid bankruptcy. These securities will not trade on any exchange but will represent a massive equity dilution for the company. With the bear case off the table and >55% of volume nearly every day for the last several months being short, I believe we will soon see a squeeze that puts the Jan 2021 GME sneeze to shame.
My theory - the rescue financing comes at the hands of none other than Carl Icahn. He acquires controlling share of the company, sells off BABY at a massive premium to Ryan Cohen who integrates it with his Teddy brand for children's goods & apparel. Carl then integrates BBBY with his other home goods assets (which are already carried in their stores). Not sure exactly how GME and GMERICA fit into it just yet, but GME + BBBY will run together due to them both being in the short basket. GME's former head of blockchain left last year to join Protocol Gemini which posted the below earlier this evening.
I think this is the big one folks. Hope you've got your tickets and are ready for the ride!
I get that the financing pushes off bankruptcy. If Buy Buy Baby is worth selling, wouldn't it be better to do that before diluting out shareholders?
No current position in either thing you mentioned. I bought GME shares and BBBY puts in the past.
They were not allowed to sell off BABY with their ABL credit from JPM, which they chose to technically default on which forces them to pay it back or start bankruptcy proceedings. My understanding is that is what the front-loaded part of this capital raise which was completed yesterday is to be used for. Stated in the 8-K there is no dilution for the next 90 days and no other dilutive issuances are permitted. They also still have not announced who this large investor/group of investors purchasing the preferred equity + warrants is. That's going to be a big piece of the puzzle.
I think your first half of the hypothesis is well reasoned. The second half, I think you're diving down rabbit holes. All it needs to be is that funding to skirt BK, that isn't traded, and is also in convertibles and warrants to boot.
If you read the 8-K and 425b, there's some interesting tidbits in there such as this is just an amendmant to their outstanding deal, another part of all this is drawing down their revolver by over half, but they agreed to ramp the interest by 100bps. Then let's not forget this involves Canadian lenders, and we know how Canuckistan has been regulatory wise lately, so there's another fun one. And lastly (at least for this post) that B. Riley is underwriting this so there's another source to check to dig up more info.
Tangent: do you think anything like what Alphabet just went through crashing $110b due to the AI mishap going to happen to BBBY? Specifcally some AI spinning off false news about the situation and causing a lot more harm than good.
Agreed my theory goes down a rabbit hole, that's why I said it was mine and am not placing that on the table as the primary reason for a squeeze.
Can't really comment on Canadian lenders, not my area of knowledge. I do know about B. Riley and have interacted w/ their bankers + ones at firms they've acquired - had nothing but positive experiences.
As to your tangent, I absolutely believe that BBBY is being negatively effected by firms scraping these various false/speculative news stories driving algorithmic selloffs. I would argue that's part of why the articles keep getting repeated over and over, same with GME. There's no benefit for these outlets to be constantly parroting how bad and risky these investments are if there weren't someone taking a massive short position that desperately needs people to sell. An article here and there about a company failing sure, but a concentrated effort across dozens of articles to spread FUD and convince retail investors to *insert buy/sell* has generally an indication to me one should do the opposite. This isn't even scratching the surface of strange occurrences like articles being published that describe a large price drop which happens minutes after the fact, spreading false stories about Ryan Cohen's involvement in other investments, etc.
Props for owning it, regardless of what some asshole on the internet who prides himself on thwarting conversations by being Mr. A2D.
The CAN gov't has been pretty heavy handed in terms of financial activities lately (lord don't even get me started on some of the projects I just worked on where CAN regulations just about derailed a multinational go-live. And SEDAR can suck it too). So that's why when I saw that mentioned in the filings my ears immediately perked up and I brought it up.
I can also see that with the AI spinning news considering half the time whenever I read two articles back to back it's literally just copy-pasta from the firm's own IR article. Now if you'll allow me, I'll do my own bit of rabbit-hole (mis)adventure. I would not be entirely shocked in this day and age if some AI comes out and does just as you said, but then the big boys' AIs (anyone seeing a trend here yet?) start to sub-penny the crap out of each other and we see entirely out of control pricing tripping circuit breakers on the ticker and spilling over to indices it's a part of . Whether on the bid or the ask side, and it just wrecks BBBY and further degrades confidence in the market. Usual disclaimer: I already have less than zero confidence in the SEC, so I openly admit I wouldn't expect them to correct things and keep things like that from happening moving forward. They'd pass any fallout onto SIPC like the yellow bellied revolving door they are.
The fuse to the dumpster fire has been lit!
Imagine still thinking that what happens to the share price in the short term for blatantly manipulated stocks is representative of reality. It's not like financial news outlets have spent the last few months dropping story after story about how the company is bankrupt and going to 0 while leaking fake stores of Ryan Cohen taking positions in other companies like Nordstrom & Alibaba, all to try and get retail to move on. They totally care about the financial wellbeing of retail traders and are just looking out for them after all. It's completely normal for a stock to suddenly be designated impossible to borrow on a Friday just hours before close with CTBs of 200%-400%+, jump 100% the following Monday trading over 2x the entire float on no news, tank 40% after hours on the positive news of no bankruptcy, then proceed to trade flat the following day over 5x average volume all while OBV remains relatively unchanged and institutional ownership actually increases. Totally natural, nothing to see here, definitely not market makers and/or other algo traders trying to cover their asses.
I said the fuse was lit but perhaps countdown being started would have been a better analogy.
I don't know what's going on but just threw $25k into BBBY. Spin the wheel.
What's that clanking I hear? Oh wait, sounds like brass...but what kind...? Nevermind. If you don't mind my asking, straight market order, options or what?
bro are you 12? both companies have horrible business and will get bankrupt. sell that shit and buy SPY. thank me later.
It's obvious you are. Jesus fuck, learn some god-damned grammar. I won't thank you for jack, but admonish you for all the broken deliverables you'll be sending over based off this show of behavior. Go load another bowl and scream gamer words in the CoD lobby and let the real adults talk over here instead.
hah you deserve to lose your money, but don't scam other kids here
Bro can you even read? This deal was done specifically to take BBBY bankruptcy off the table... GME paid off all their LT debt and are sitting on nearly $1b in cash & equivalents so it's literally impossible for them to go bankrupt... Do you know how to read financial statements or do you just start your day with Cramer stock tips?
both businesses are losing money, so you'll need extra financing eventually even if you currently have debt paid.
you can do whatever you want with your money. but don't advertise this scam on public forums.
aslo, I don't believe you're in PE cause somebody in PE wouldn't need to pump pre-bankruptcy stocks on a forum.
Yeah...because Vanguard and Blackrock wouldn't file 8% and 7.2% schedule 13's accordingly in GME because they thought the company was going to push daisies in the nearterm. And if you read the XBRL and the FACE statements and did your homework you might understand that too.
And what do you know? I'll be damned! Vanguard filed a 13/A for 7.31% ownership of BBBY. Obviously no faith in that company making it! Or the 425b that was filed by BBBY that laid it all out even further to raise $230,665,750 after underwriting. "BRS has agreed to purchase the respective number of Shares and Warrants shown opposite its name in the following table. We will file the Underwriting Agreement as an exhibit to a Current Report on Form 8-K, which will be incorporated by reference in this prospectus supplement." Total nosedive funding operation if I ever saw one. /s
Seriously, do some of you people actually do any due diligence anymore?
How will GME go bankrupt when it has no debt? lmao trust me it's okay to stay silent when you don't know what you're talking about
both businesses are losing money, so you'll need extra financing eventually even if you currently have debt paid. lmao trust me it's okay to stay silent when you don't know what you're talking about
This post top-ticked the market perfectly. Impressive.
How is massive equity dilution + giving away optionality on recovery value any different/better than the bankruptcy bear case for existing equity?
How is a business that's a going concern with billions in revenue, executing on an operational restructuring kicked off by one of the best consumer retail operators on earth, with a buyer wiling to come in at a valuation multiple times the current market cap better than a business that's bankrupt from the perspective of equity holders? Are you seriously asking that question or was this meant to be rhetorical?
bump
BBBYQ officially a zero. GME -85% since its highs. You may need to reevaluate your investing decisions.
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