Cost Plus Shareholders Tender Shares in Takeover

Retailer Bed, Bath & Beyond Inc. (NASDAQ: BBBY) announced this morning that its tender offer of $22/share for Cost Plus Inc. (NASDAQ: CPWM), which expired last night, garnered approximately 92% of the outstanding shares of Cost Plus. Bed, Bath & Beyond intends to acquire 90% plus one share of Cost Plus and to operate the acquired stores as a subsidiary as soon as the offer closes.

In its announce, Bed, Bath & Beyond noted that previous EPS guidance for the second quarter of $0.97-$1.03 did not include Cost Plus and the company now expects EPS to be lower “by several cents, including transaction and integration costs.” For the full year, the company expects net profits per diluted share to “increase by a high single to a low double digit percentage range.”

Bed, Bath & Beyond stock plunged from its 52-week high following the company’s first quarter earnings report last week. The acquisition of Cost Plus is generally viewed as a plus for the company, and based on today’s stock price the implied gain is 22%. The stock’s consensus target price is $75.35, just under its yearly high.

Shares of Bed, Bath & Beyond are up about 3.5% at $61.71 in a 52-week range of $48.75-$75.84.

Paul Ausick