KB Toys
In 1999, the company operated 1,324 stores across the United States and was the second-largest toy retailer in the U.S., but it later declared bankruptcy in both 2004 and 2008 before going out of business on February 9, 2009."[15][16] That year, Melville Corporation purchased Circus World's 330 stores in 32 states for $95 million; the locations became part of the Kay-Bee division.[30] In September 1999, Consolidated Stores announced plans to sell 20 percent of KBKids through shares in an upcoming public offering.[32] In January 2000, Consolidated Stores filed with the U.S. Securities and Exchange Commission to have KBKids listed on the NASDAQ as a separate and publicly traded company with the ticker symbol "KBKD".[38][35] The investment group included 200 store managers led by Bain Capital and by KB Toys' chief executive officer Michael Glazer.[35][39] Bain Capital contributed $18.1 million to the sale, while the remainder was financed by banks that lent the money to KB Toys.[40][41][46] KB Toys suffered tough competition during the 2003 Christmas season, in addition to expensive store leases in malls with decreased customer visitation.[6][47][40] Creditors stated that the 2002 dividend deal with Bain Capital had rendered KB Toys insolvent, resulting in a loss of $109 million leading up to the bankruptcy filing.[40][41] In February 2005, KB Toys' creditors, including Hasbro and Lego, accused the company's top executives and majority shareholders of improperly providing themselves with multimillion-dollar payments prior to the bankruptcy.[51] KB Toys exited Chapter 11 bankruptcy in August 2005, with 90 percent of its ownership under PKBT Holdings, an affiliate of Prentice Capital Management.Because K·B Toys' stores had been closed and liquidated, the sale applied mainly to the company's logo, website, trademarks, and other intellectual properties.Kasoff stated that the delay would "give us plenty of time to build out the most optimum supply chain, distribution and retail infrastructure our customers deserve."Strategic Marks sought an investment bank to finance the opening of 200 to 250 temporary KB Toys stores, which would determine whether permanent locations would be viable.KB Toys denied the allegation, and stated that racial demographics were not a consideration when enacting the policy 13 years earlier.[64] By March 2000, the lawsuit had been amended to include three additional black plaintiffs, and the suit sought damages as well as an end to the company's check-writing policy.[67] In 2001, the district attorney for Napa County, California filed a lawsuit alleging that KB Toys misrepresented sale prices and that it sold returned items as new.