WILMINGTON, Del. (CN) – Just in time for Christmas, KB Toys filed for bankruptcy, listing more than $100 million in debts. It’s the second bankruptcy filing for KB in four years, and is expected to put even more market power in the hands of giant retailers such as WalMart and Toys R Us, industry analysts said.
It looks like lights out for KB Toys this time, which is expected to liquidate its stores.
KB was founded by two Kaufman brothers in 1922 as a candy company but switched to toys during World War II because of a sugar shortage. Ironically, the Kaufman brothers acquired a wholesale toy company as payment for debts.
KB Toys’ largest creditor in its Chapter 11 filing is Li & Fung Toy Island Manufacturing, which KB owes $27.2 million.