TRU’s Eyler, Kay to resign
WAYNE, N.J. — Literally at the eleventh hour, Toys "R" Us CEO John Eyler and COO Christopher Kay apparently are taking the money and running: Both will resign their positions when the expected TRU buyout becomes official this week.
Eyler and Kay are part of the executive team that earlier this year was promised some $187 million to stay until the acquisition became final. According to a regulatory filing, the majority cut of the payout would go to Eyler, who is due $65 million.
On Thursday, shareholders will vote on a $26.75-a-share buyout by a private investment group that includes Kohlberg Kravis Roberts & Co., Bain Capital Inc. and Vornado Realty Trust. If approved at the special meeting, the deal is expected to close by the end of July.
TRU spokesperson Susan McLaughlin confirmed to playthings.com that news of the resignations was sent to company employees earlier today in an internal memorandum.
She said Richard Markee, vice chairman of the corporation and president of the company's U.S. toy division, will serve as interim CEO in addition to his responsibilities with Babies "R" Us. Additionally, John Barbour remains as president of TRU, she said.
McLaughlin added that a search for a new CEO has been launched, but no word of the search company has been made public by the new owners.
Playthings.com first reported information about the compensations packages, although at the time, dollar amounts were not available. Toys "R" Us operates 1,282 toy stores and 217 Babies "R" Us stores.
Total compensation packages include severance, bonuses and related tax obligations, and stock options held by current and former officers.
The figure was included in a preliminary proxy statement filed with the SEC in connection with the TRU buyout by the three companies.
Included in the $187 million total is a "success" bonus due to each Toys "R" Us executive, excluding Eyler, if the officer stays with the company through the close of the buyout.
Meanwhile, according to reports, a Delaware judge is expected to rule ahead of the vote on a court challenge to delay the closing and require the company to entertain other bids.
Vice Chancellor Leo Strine of Delaware's Court of Chancery heard arguments Friday, the report stated.
In a statement, Eyler said he is planning to retire, while Kay has not commented about his plans.