KB Toys: Details of New Ownership Announced
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KB Toys, the nation's largest combined mall-based and online specialty toy retailer, announced today that its management team, led by Chief Executive Officer, Michael L. Glazer, has partnered with Bain Capital, Inc., a leading global private equity firm, to acquire the stock of KB Toys from Consolidated Stores CorporationConsolidated Stores announced its plan to divest KB Toys in June 2000 and signed a letter of intent in mid-November with Bain Capital. The approximate $300 million transaction encompasses all KB Toys divisions including KB Toys, KB Toy Works, KB Toy Outlet, KB Toy Liquidators, KB Toy Express, and the online retailing operation, KBkids.com. Under this new ownership structure, KB Toys, which has been in business for more than 78 years, will combine the brand strength of its more than 1,300 stores with its growing online business to provide customers with the most convenient toy shopping experience. ``I am extremely proud of our entire management team for their proven track record, experience and creativity in building our business and sustaining strong relationships with our customers and business partners,'' said Glazer. ``By partnering with Bain Capital, a leading private equity firm, this transaction affords us the opportunity to grow our sales, increase market share, seek out new online opportunities and continue to provide our customers with the most convenient toy shopping experience.'' Bain Capital has $12 billion of assets under management and has been an active investor in the retail and consumer goods section since its inception in 1984. Among its many investments, the firm holds a majority stake in Domino's Pizza, was a founding investor in Staples, an office supply retailer with over 1,000 stores worldwide, and Brookstone, a specialty retailer offering an assortment of consumer goods. ``We are impressed with Michael Glazer and the accomplishments of the management team at KB Toys,'' said Bob White, Managing Director of Bain Capital, Inc. ``KB Toys has grown its business and produced solid earnings and operating revenues in the highly cyclical toy retailing industry. We look forward to working with the management team to continue their vision of servicing customers through a variety of convenient delivery channels.'' Fleet Retail Finance Inc. and Back Bay Capital, subsidiaries of FleetBoston Financial, will provide a working capital facility of $495 million to the company. ``Our decision to agent this transaction was based on our strong belief in the historic financial performance of KB Toys, its management team and its strong prospects for the future,'' said Ward K. Mooney, President of Fleet Retail Finance. ``We have a high regard for Bain Capital as an investor in the retail segment and look forward to working with them throughout this transaction.'' KB Toys is the nation's largest combined mall-based and online specialty toy retailer operating more than 1,300 stores in all 50 states, the American Territory of Guam and the Commonwealth of Puerto Rico, doing business as KB Toys, KB Toy Works, KB Toy Outlet, KB Toy Liquidators, KB Toy Express and with Online Shopping at KBkids.com. Offering a wide and competitively priced selection of toys and video games, commitment to customer service, convenient mall locations and a growing online shopping site, KB Toys combines the speed of the Internet with the convenience of returns at any store. KB Toys is headquartered in Pittsfield, Massachusetts, and employs more than 13,000 associates nationwide. Bain Capital Inc. is a global private equity firm that manages several pools of capital including private equity, high-yield assets, mezzanine capital and public equity with over $12 billion in assets under management. Since its inception in 1984, the firm has made private equity investments and add-ons in over 225 companies, in a variety of industries, including technology and communications, retail, media and entertainment, healthcare, consumer goods and industrial products. Bain Capital partners with exceptional management teams in order to build long-term value in its portfolio companies. Headquartered in Boston, Bain Capital has offices in New York, San Francisco and London. For more information visit www.baincapital.com. Fleet Retail Finance Inc. is one of the leading asset-based lenders in the country exclusively devoted to the retail industry. Fleet Retail Finance provides inventory-based working capital loans, long-term capital for expansion, turnaround financing, capital markets advisory services, global trade finance and cash management services. The company has agented more than $7 billion in financing to retailers across the U.S., Canada and the UK. Fleet Retail Finance is a subsidiary of FleetBoston Financial, a $179 billion diversified financial services company and the eighth-largest financial holding company in the United States. FleetBoston Financial offers a comprehensive array of innovative financial solutions to 20 million customers in more than 20 countries and territories. FleetBoston Financial is headquartered in Boston and listed on the New York Stock Exchange and the Boston Stock Exchange. [Posted 12/08/2000]
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