June 13, 2024

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Bed, Bath, and Beyond board drama unveiled in investor’s open letter

2 min read

Investment firm JAT Capital sent Bed, Bath & Beyond’s board its second open letter of the month last week. This time, JAT founder John Thaler, is criticizing the board for creating the worst boardroom crisis he’s ever seen. 

On Friday, Thaler wrote a letter to the board of Beyond, Inc shredding its corporate governance practices. JAT owns a 9.6% stake in Beyond, the company used to be known as Overstock.com until it bought Bed, Bath and Beyond out of bankruptcy in June and rebranded itself as such. Thaler’s scathing letter to Beyond’s board of directors accused it of being needlessly secretive, gearing up for a nonexistent proxy battle, and botching a CEO succession plan. 

“Something strange is happening here, and the people in charge must explain themselves,” JAT founder John Thaler wrote in the letter. 

Thaler said the board’s decision making and behavior were unprecedented and the worst he’s seen in his career.  

“Maybe these actions are simple errors in judgment or might even have some logical explanation, but of course after a string of repeated actions are taken that all point in the same direction it is natural to question whether people have bad intent,” Thaler wrote. 

Questioning the board chair

Thaler’s main antagonist in the letter was board chair Allison Abraham for whom he reserved his harshest criticism. Abraham, who has been board chair since 2017, is the founder and principal of a K-8 private school in Virginia. Thaler accused her of planning a defense for a proxy battle at the expense of her duties. “A defense against what?” Thaler wondered in his letter. 

The question for Thaler remains why the board would gird themselves against a proxy fight when he hasn’t filed for one at the upcoming shareholders meeting. “It’s a bizarre thing to engage in a proxy defense, when there’s no proxy to defend against,” Thaler told Fortune

JAT says it isn’t an activist investor but has been…

Paolo Confino

2023-11-21 17:48:50

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