Wayne, N.J., Add another billion-dollar retail transaction to the history books. Toys âRâ Us, the original category killer, agreed to be bought by a consortium of two different private equity firms and Vornado Realty Trust. The trio, which will be equal partners in the deal, agreed to pay $5.7 billion for the toy chain. The investors, Vornado, Kohlberg Kravis Roberts, and Bain Capital Partners, agreed to pay $5.7 billion for the toy stores as well as the Babies âRâ Us stores. The chain had originally hoped to split the two business, and focus on the faster-growing Babies.
The deal once again brings attention to the valuable real estate holdings at some struggling retailers. While Toys âRâ Us has been steadily losing the market-share battle to Wal-Mart over the years, its leases are increasingly valuable. According to reports, the trio of new owners will continue to operate Toys âRâ Us as a toy chain for the foreseeable future. Reports also indicate that Toys âRâ Us president John Barbour will stay on board.