Bain Capital accused of raiding KB's piggy bank (March 27, 2006--Boston Business Journal) [View all]

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http://www.bizjournals.com/boston/stories/2006/03/27/story2.html

Bain Capital LLC and the former management team at KB Toys Inc. are being sued in a Massachusetts court for allegedly stripping more than $121 million out of the toy retailer's "piggy bank" and then allowing the struggling company to spiral into bankruptcy.

The January suit is just the latest twist in the five-year saga involving KB and Bain, which purchased the toy chain for roughly $305 million in 2000. At the time, Bain paid around $20 million in cash and borrowed the remainder to acquire KB from discount retailer Big Lots Inc. of Columbus, Ohio.

Today Big Lots is but one of a handful of creditors, including game and toy maker Hasbro Inc. (NYSE: HAS), represented by the so-called Residual Trust of KB Toys Inc. Through its suit in Suffolk Superior Court, the group is hoping to recover $114 million in what it alleges are ill-gotten gains collected by Bain and KB's former officers.

Bain purchased KB in 2000.