Boston-based private equity firm Bain Capital Inc. this month partnered with the management of K*B Toys to acquire its stock from Consolidated Stores Corp.
The transaction is valued at approximately $300 million, which reportedly consists of a $258 million equity investment from Bain Capital and a $45 million bond and warrant for common stock issued by K*B Toys.
Consolidated Toys retained Credit Suisse First Boston to find a buyer when it announced it would divest the toy retailer in June to focus on its core businesses. Bain Capital signed a letter of intent last month. The deal was led Michael Glazer, K*B Toys’ chief executive officer.
Currently K*B Toys, based in Pittsfield, Mass., operates more than 1,300 retail stores in all 50 states, Puerto Rico and Guam.
“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 out customers and business partners,” said Glazer in a statement. “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 declined comment for this story.
FleetBoston Financial subsidiaries Fleet Retail Finance Inc. and Back Bay Capital will provide a $495 million working capital facility, which president of Fleet Retail Finance Ward Mooney, said is “based on our strong belief in the historic performance of K*B Toys, its management team and its strong prospects for the future.”
Previously, Bain Capital has invested in numerous retail companies including Bentley’s Luggage and Gifts, home furnishing retailer Domain, drug store retailer Duane Reade, Mattress Discounters, The Sports Authority and Staples.