Toys "R" Us
PE-Owned3 Documented ImpactsIconic toy retailer destroyed by $6.6B LBO from Bain Capital, KKR, and Vornado. PE firms extracted $464M in fees while loading $5.2B in debt. 33,000 U.S. workers lost jobs when all stores liquidated in 2018.
Ownership Information
Toys "R" Us is owned by Bain Capital. Private equity ownership often leads to cost-cutting, price increases, and reduced quality of service as firms prioritize returns for investors over customers and employees.Learn more about PE ownership impact →
Timeline
Toys "R" Us founded
Acquired by Bain Capital for $6.6 billion
Toys "R" Us loaded with $5.2 billion in LBO debt
Of the $6.6B acquisition price, only $1.3B was equity from the PE consortium. The remaining $5.2B was loaded as debt onto the company itself, requiring $400M/year in interest payments.
Toys "R" Us bankrupted by PE debt: 30,000+ workers lost jobs
KKR, Bain Capital, and Vornado's 2005 leveraged buyout loaded Toys "R" Us with $5.3B in debt. The company couldn't invest in stores or compete with Amazon, leading to liquidation in 2018.
Toys "R" Us liquidated after PE firms extracted $464M in fees
Bain Capital, KKR, and Vornado's $6.6B leveraged buyout loaded $5.2B in debt. Annual debt service of $400M starved the company of investment capital. 33,000 U.S. workers lost jobs when all 735 stores closed.
How PE Killed Toys "R" Us
The Atlantic →Leveraged Buyouts and Financial Distress
NBER Working Paper →How Private Equity Killed Toys R Us
Bloomberg →Toys R Us Workers Got Nothing. The PE Owners Got $470 Million.
In These Times →Before vs. After PE Acquisition
Jobs lost
Reported 2018
Before PE
33,000 employees
After PE
0 (liquidated)
↓ 100%
U.S. stores
Reported 2018
Before PE
735 stores
After PE
0 (liquidated)
↓ 100%
Annual debt service
Reported 2005
Before PE
$0
After PE
$400M/year
Community Reviews
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