Bed Bath & Beyond shares jump 31% after a report the meme-stock favorite has secured new funding
- Bed Bath & Beyond shares jumped more than 31% in premarket trading Wednesday.
- The meme stock's surge followed a Wall Street Journal report on a new loan deal the company secured.
Sources told the Journal the company announced to prospective lenders on Tuesday that it had picked a lender to provide a loan.
Financial terms aren't yet clear, though the Journal previously reported the company had sought roughly $375 million to help pay down existing debt.
Bed Bath & Beyond stock leapt 31% before the opening bell to trade at around $11.54.
The Journal reported that the financing is set up as first-in-last-out loan that will rank lower than other secured debt in the event of a bankruptcy.
An injection of new liquidity is seen giving the company's vendors confidence to continue selling goods to the company following its push into private-label brands that faltered, according to the report.
Shares of the meme-stock favorite have endured a roller-coaster ride this month as retail investors pushed the stock as high as $30. Then, last week billionaire activist investor Ryan Cohen shed his stake in the company, sending shares below $9.
Meanwhile, a college student cashed out $110 million in profit from the meme stock after building a 6.2% stake in the company.
On Tuesday, the stock closed at $8.78, above the $5 mark it had begun the month at but still well below the highs of recent rallies.
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