9
   

Who killed Toys 'R' Us

 
 
Reply Tue 24 Apr, 2018 10:17 am
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Type: Discussion • Score: 9 • Views: 738 • Replies: 31

 
edgarblythe
 
  0  
Reply Tue 24 Apr, 2018 10:18 am
Similar shenanigans are what is killing Sears.
0 Replies
 
Linkat
 
  3  
Reply Tue 24 Apr, 2018 10:28 am
@edgarblythe,
Amazon
Walmart
edgarblythe
 
  1  
Reply Tue 24 Apr, 2018 10:43 am
@Linkat,
Bet you didn't listen to Dan.
Linkat
 
  1  
Reply Tue 24 Apr, 2018 11:14 am
@edgarblythe,
I couldn't hear Dan -- I need to open up on another computer
0 Replies
 
Sturgis
 
  1  
Reply Tue 24 Apr, 2018 11:29 am
Yet another case of the rich getting richer. They know every last way to get out of paying their debt and slapping it back on the thing they are allegedly buying.
In the end, they don't care as long as they keep increasing their wealth.

0 Replies
 
Kolyo
 
  2  
Reply Tue 24 Apr, 2018 05:16 pm
Why don't companies avoid getting bought up by the likes of Bain capital?
edgarblythe
 
  0  
Reply Tue 24 Apr, 2018 05:38 pm
As I wrote earlier, Sears is the same kind of victim.
https://www.newsandguts.com/video/dan-rather-trump-insider-massive-hedge-fund-helped-kill-sears/
0 Replies
 
chai2
 
  1  
Reply Tue 24 Apr, 2018 07:04 pm
Boy, Dan Rather looks really amazing for 86.
0 Replies
 
Real Music
 
  1  
Reply Tue 24 Apr, 2018 07:29 pm
@Kolyo,
Quote:
Why don't companies avoid getting bought up by the likes of Bain capital?

If anyone has the answer to this question, please let the rest of us know. That is a good question.
Kolyo
 
  1  
Reply Tue 24 Apr, 2018 08:14 pm
@Real Music,
I studied economics and would research it myself if I didn't have to work 80 hours a week.

I think that Bain may offer shareholders a very high price for their stock, but that's just a hunch.

When I heard people like Romney did this sort of thing my immediate reaction was: how the hell can this happen!
farmerman
 
  4  
Reply Wed 25 Apr, 2018 04:41 am
@Kolyo,
remember, Toys R Us , could have refused the deal.
0 Replies
 
eurocelticyankee
 
  1  
Reply Wed 25 Apr, 2018 12:59 pm
Smyths are buying up some of the European business.

https://www.independent.ie/business/irish/smyths-toys-to-buy-toys-r-us-german-and-austrian-stores-36830117.html

The vultures are circling.
0 Replies
 
cicerone imposter
 
  1  
Reply Wed 25 Apr, 2018 07:37 pm
@Linkat,
I agree wit Linkat, but will add Target.
0 Replies
 
glitterbag
 
  1  
Reply Wed 25 Apr, 2018 08:13 pm
This is all so depressing.
cicerone imposter
 
  1  
Reply Wed 25 Apr, 2018 09:27 pm
@glitterbag,
To cut cost, the retail business is making most things automatic with self-service check out. We heard about a "cashless society" some years ago, but it's now in its infant stages now.
0 Replies
 
InfraBlue
 
  2  
Reply Wed 25 Apr, 2018 10:09 pm
KKR was one of the players in the leveraged buyout fad in the 1980's. That's how they bought RJR Nabisco in 1988, which was the largest leveraged buyout at the time, $25 billion. KKR charged the debt to them as well, like they did to Toys R Us. There was a book and then an HBO movie about it, Barbarians at the Gate: The Fall of RJR Nabisco.
0 Replies
 
Baldimo
 
  1  
Reply Thu 26 Apr, 2018 12:58 pm
@edgarblythe,
Why was Toys R Us for sale in the first place?

Quote:
At its peak, Toys "R" Us was considered a classic example of a category killer, a business that specializes so thoroughly and efficiently in one sector that it pushes out competition from both smaller specialty stores and larger general retailers.[25] Since the rise of mass merchants like Walmart, Target and Amazon, however, Toys "R" Us lost much of its share of the toy market, and fell behind Walmart in toy sales for 1998.[26]

To improve the company, the board of directors installed John Eyler (formerly of FAO Schwarz) in 2000.[27] Eyler launched an unsuccessful, expensive plan to remodel and re-launch the chain.[28] Blaming market pressures (primarily competition from Walmart and Target), Toys "R" Us considered splitting its toy and baby businesses.[29] On March 17, 2005, a consortium of Bain Capital Partners LLC, Kohlberg Kravis Roberts (KKR) and Vornado Realty Trust announced a $6.6 billion leveraged buyout of the company.[30] Public stock closed for the last time on July 21, 2005 at $26.74—a 63% increase since when it first announced that the company was put up for sale. Toys "R" Us became a privately owned entity after the buyout.[31] However, the company still files with the Securities and Exchange Commission (as required by its debt agreements).[32]

It sounds like they were already failing in the early 2000's when the buy-out took place. It would seem that private equity ownership kept the company running for far longer time than if they hadn't bought it. With the surge of Amazon in the last few years, Toys R Us had no chance, their prices for the same toys was higher than Walmart or Amazon. I know, I collect certain Star Wars figures and would only go to Toys R Us if they had any exclusives.

When my kids were growing up in the 2000's, we never bought them toys from there either. Walmart was always cheaper then as well. My parents to my knowledge never bought any of our toys from there either for the same reason. Only rich people shopped at Toys R Us, us poor folks shopped at K-Mart and Venture.
edgarblythe
 
  1  
Reply Thu 26 Apr, 2018 01:49 pm
@Baldimo,
Leveraged buyouts happen.
maporsche
 
  1  
Reply Thu 26 Apr, 2018 05:44 pm
@edgarblythe,
Do they happen to successful companies whose businesses are thriving?

Are they all bad?


Honest questions.
 

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