Bed Bath & Beyond (BBBY) had no long-term debt on its balance sheet. Although many analysts as of the balance sheet BBBY a strength that allows greater flexibility, some commented on the risks of their growing cash balance. These concerns raised the question of BBBY’s capital structure. In early 2004, interest rates were at historic lows, it is an attractive time to consider the issue of debt securities and execution either on a share buyback program or a one-time special dividend. Offers a few capital stru … Read more »

Bed Bath & Beyond (BBBY) had no long-term debt on its balance sheet. Although many analysts as of the balance sheet BBBY a strength that allows greater flexibility, some commented on the risks of their growing cash balance. These concerns raised the question of BBBY’s capital structure. In early 2004, interest rates were at historic lows, it is an attractive time to consider the issue of debt securities and execution either on a share buyback program or a one-time special dividend. Capital structure offers a few suggestions for students to analyze.
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from
Artur Raviv,
Timothy Thompson,
Phillip Gresh
Shannon Hennessy
Source: Kellogg School of Management
14 pages.
Release date: 30 July 2004. Prod #: KEL082-PDF-ENG
Bed Bath & Beyond: The capital structure decision HBR case solution