Source: Toys ‘R’ Us files for bankruptcy, crushed by online competition – The Denver Post Much of the toy merchant’s debt is the legacy of a $7.5 billion leveraged buyout in 2005 in which Bain Capital, KKR & Co. and Vornado Realty Trust loaded the company with debt to take it private. Since then, the Wayne, New Jersey-based chain has struggled to dig itself out. Great debt sucks the profits and capital needed to invest and improve. So the subsequent 'management' cuts what led to the original success. In effect killing the golden goose. Bob Wilson
couldn't agree more, should be no tax deductions for that kind of debt. wasn't bain one of mitt's interests?
He was not alone but copied the same nonsense that has destroyed so many companies in the past. Martin Shkreli is another fine example. To me, they look like legalized, loan-sharks. Bob Wilson
unfortunately, the ftc has allowed too much of this stuff over the last 30 or forty years, and congress has been complicit. as i've stated before, when goldman sachs got their foot in the door, all heck broke loose.
That, I suspect, may be more of a problem than the tax and hedge-fund issue. Bain, KKR et al totally failed to see that toys were one of the markets best suited to e-commerce. I have two kids who are very much of the Toys R Us age demographic, and both of whom have lots of school friends for whom we must buy birthday presents when the kids are invited to parties. I buy a lot of the kind of toys that Toys R Us sells. (I have probably trodden barefoot on more Shopkins than Toys R Us sells in a year.) There are 12 Toys R Us stores within a half-hour drive of our house. And I haven't been into a Toys R Us in the last ten years.
that's amazing. i never think of these companies as international. how hard is it to open a toy store?
Oh, yes, they're everywhere. In Shanghai, there was one within a ten-minute walk of my office and another two within a 20-minute walk of my house, and all of them were enormous, but I would imagine that Tmall and JD.com are killing them now. I have read books and watched documentary films about this. It is very difficult. In general, you have to be a very old man with magic powers, and you have to be able to bring the toys to life. And you have to be a bit lonely but then rediscover the magic of love. This may be the other area (aside from the threat of e-commerce) in which Bain and KKR misunderestimated the challenge and failed when Mr Magorium made success seem so easy.
Colbert's Super Pac ran an ad comparing Mitt to a serial killer. Colbert Super PAC - Mitt Romney Attack Ad - The Colbert Report | Comedy Central Starts around the 35 second mark.
