Toys 'R' Us Is Closing 180 U.S. Stores After Declaring Bankruptcy

[rurallib]

6. Vulture capitalists are the culprit behind the Toys'R'Us demise and many more to come

Read many articles on this prior to the holidays. Leveraged buyouts followed by the standard prescription of selling off assets and rearranging and piling on debt that the leveraged business can't pay.
Here is one story:

https://www.nakedcapitalism.com/2017/09/toys-r-us-another-private-equity-casualty.html

Private Equity Greed: A Plague on Retail Businesses

Likewise, Pam and Russ Martens don’t mince words when they describe the underlying cause for this year’s wave of retail bankruptcies in their Wall Street on Parade post, How Many of 2017’s Retail Bankruptcies Were Caused by Private-Equity’s Greed?

According to S&P Global Market Intelligence, there have been 35 retail bankruptcies this year, almost double the 18 retail bankruptcies of last year. The filing by Toys ‘R’ Us this week was the latest.

What many of these retailers have in common is that they were taken private in leveraged buyouts (LBOs) by private equity (PE) firms. Toys ‘R’ Us, Payless ShoeSource, The Limited, Wet Seal, Gymboree Corp., rue21, and True Religion Apparel were all LBOs. Gander Mountain can also be included in this list if you reach back to its 1984 LBO. Far too many LBOs are simply asset stripping operations by Wall Street vultures who load the company with enormous debt, then asset strip the cash from the company by paying themselves obscene special dividends and management fees.

It is easy to blame online shopping as the culprit. Most of these businesses have online presence. Nope, it is the Mitt Romneys of the world that are the ones to blame.