Bernie Sanders asks if private equity owners 'deliberately' killed Toys 'R' Us

[Uncle Joe]

Sen. Bernie Sanders and other liberal lawmakers asked the private equity owners of Toys “R” Us Thursday whether they intentionally forced the toy company toward bankruptcy and mass layoffs.

“We are concerned that your investment firms have deliberately chose this path for the company, its works and its communities,” the Congressional Progressive Caucus wrote in a letter to executives at Bain Capital, KKR, and Vornado Realty Trust, the firms that bought Toys “R” Us in 2005.

None of the three investment companies responded to a request for comment.

Sanders, I-Vt., and the other members of Congress faulted the leveraged buyout model employed by the investment firms for causing the toy company’s failure, and asked the executives whether it was a deliberate policy to “load the company with debt.” They also asked if they planned to offer severance pay to any workers.

(snip)

https://www.washingtonexaminer.com/policy/economy/bernie-sanders-asks-if-private-equity-owners-deliberately-killed-toys-r-us

[GeorgeGist]

1. Sounds about right.

[exboyfil]

2. Gordon Gecko

Bud Fox: Why do you need to wreck this company?

Gordon Gekko: Because it's WRECKABLE, all right? I took another look at it and I changed my mind!

[sandensea]

3. Of course. It's their very business model: the mafia-style bust-out

[Hoyt]

4. Nope. Toys R Us was in big trouble when they sold out in 2005. Had they not, they likely would have

gone under much sooner as their debt had just been downgraded to "junk" status before private equity even became involved in 2005.

Not a fan of private equity, but it's kind of like pay day loans -- sometimes that is the only alternative left, short of robbing a bank, going hungry, shutting down, etc.

[Uncle Joe]

5. Competition from Walmart hurt them as well

It's a shame, Toys R Us was strong in Toys for Tots.

[Hoyt]

6. Good point, and the internet. Agree, Toys for Tots is a great program.

[stuffmatters]

7. It's the Bain/Romney business model: Leverage(on employees' pension funds),self enrich, bankrupt

Pump, drain, dump..... private equity, it's what they do

[Turbineguy]

8. Not anymore deliberate

than a vampire sucking blood out of a victim.

[Squinch]

9. Really? He asked that? Wow.