WSJ News Exclusive | Bed Bath & Beyond's Buybuy Baby Draws Buyer Interest |

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Bed Bath & Beyond has been exploring alternatives for Buybuy Baby.

Photo:

Michael M. Santiago/Getty Images

Updated April 22, 2022 3:43 pm ET

is fielding interest from potential acquirers of its Buybuy Baby business after the retailer came under pressure from an activist investor to unload the unit.

Suitors for the baby-gear chain include private-equity firm Cerberus Capital Management LP and

Tailwind Acquisition Corp.

TWND 0.40%

, a special-purpose acquisition company chaired by former Casper Sleep Inc. Chief Executive

Philip Krim,

according to people familiar with the matter. There is no guarantee the expressions of interest will result in a deal.

Union, N.J.-based Bed Bath & Beyond has been exploring alternatives for Buybuy Baby. The company added three new directors to its board as a part of a settlement agreement with activist investor

Ryan Cohen

in March, with two of them joining the committee overseeing the Buybuy Baby review.

Mr. Cohen, who co-founded pet-products retailer

Chewy Inc.

and is chairman at

GameStop Corp.

, has a roughly 9.8% Bed Bath & Beyond stake. He has said he believes Buybuy Baby could be worth as much as the entire company, which had a market value of roughly $1.3 billion Friday afternoon. He also called on the company to consider a full sale, which is another possibility.

Details of any bids for Buybuy Baby couldn’t be learned.

Bed Bath & Beyond reported disappointing results earlier this month, with net sales falling 22% to $2.1 billion in the three months ended Feb. 26.

New York-based Cerberus is no stranger to investing in the retail and consumer sector, with a range of investments including one in supermarket chain

Albertsons

Cos.

Private-equity firms have long been drawn to retailers. A current sales process for department-store chain Kohl’s Inc. has attracted firms including New York-based Sycamore Partners, among others, The Wall Street Journal has reported.

Private companies are flooding to special-purpose acquisition companies, or SPACs, to bypass the traditional IPO process and gain a public listing. WSJ explains why some critics say investing in these so-called blank-check companies isn’t worth the risk. Illustration: Zoë Soriano/WSJ

Write to Laura Cooper at laura.cooper@wsj.com and Cara Lombardo at cara.lombardo@wsj.com

Appeared in the April 23, 2022, print edition as ‘Bed Bath & Beyond Attracts Interest for Buybuy Baby Unit.’

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