KB Toys gets court approval to hold auction for professional liquidator for 490 stores

By Jeff Pines

Washington, Jan. 22 - KB Toys, Inc. got the green light for its auction to select a liquidator to handle the stores it plans to close.

The U.S. Bankruptcy Court for the District of Delaware also authorized a breakup fee of $75,000 to the initial bidder and an expense reimbursement of up to $25,000, payable only if KB Toys and the court select another bidder other than the initial one.

KB's initial bidder is a joint venture between Gordon Brothers Retail Partners, LLC and Garcel, Inc. The agreement is subject to KB not getting better bids from other liquidators.

Bidders must file by Jan. 26 and the auction will be held the next day.

The company plans to close 490 stores.

A final hearing on the motion to conduct store closing sales will be held Jan. 28.

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