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REIT and Equity Partners Buy Toys 'R' Us for Nearly $7B

WAYNE, NJ-Instead of merely buying the company's toy stores, the three partners are going to buy all of the company.

By Dees Stribling | Updated on March 17, 2005

For more retail coverage, click GlobeSt.com/RETAIL.

WAYNE, NJ-In a surprise move consummated this morning, Vornado Realty Trust, Bain Capital and Kohlberg, Kravis, Roberts & Co. have agreed to buy specialty toy and baby-product retailer Toys ‘R’ Us Inc. It had been reported that the only toy side of the business had been on the block, but not the more successful Babies ‘R’ Us. Currently the Toys ‘R’ Us mix of properties includes domestic 681 toy stores and 601 toy stores in other countries, plus 218 Babies R Us, all of which are in this country.

The three-partner venture will acquire all of the outstanding equity of Toys ‘R’ Us for $26.75 per share in cash or about $6.6 billion, which was approved by the board of directors of Toys ‘R’ Us. They will have equal shares. The deal is still contingent on regulatory review and approval by the shareholders of the company, but is expected to be finalized by July. Toys ‘R’ Us stock was trading at about $25.35 per share Thursday morning, up slightly after the announcement.

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