Consolidated Stores Sells Its K-B Toys Unit

Close-out retailer Consolidated Stores Corp. said that it has sold its K-B Toys division to an affiliate of Boston-based investment company Bain Capital Inc. for $305 million. The separation of Consolidated’s close-out and toy businesses is intended to improve the performance of each entity, the company said. KB’s management will continue to lead the chain of toy stores. Consolidated, whose chains include Pic ‘N’ Save and MacFrugal, will record an after-tax loss related to the sale of $407 million in its third quarter. Consolidated announced in June that it wanted to sell the division. It bought the chain in 1996 from Melville Corp. K-B, based in Pittsfield, Mass., has 1,314 toy and close-out toy stores in 50 states and Puerto Rico. It is the second-largest chain, behind Toys R Us Inc. Shares of Consolidated fell 56 cents to close at $8.25 on the NYSE.