Annual report pursuant to Section 13 and 15(d)

Related Party Transactions

v2.4.1.9
Related Party Transactions
12 Months Ended
Jan. 31, 2015
Related Party Transactions  
Related Party Transactions

13. RELATED PARTY TRANSACTIONS

 

Bain Capital Partners, LLC (“Bain Capital”) and The Blackstone Group L.P. (“The Blackstone Group”, together with Bain Capital, the “Sponsors”) own approximately 70% of our outstanding common stock as of  January 31, 2015. Prior to our IPO on July 2, 2014, the  Sponsors and another common stockholder, Highfields Capital Management LP (“Highfields”), received annual management fees of $12 million and $1 million, respectively.  In connection with the IPO, the management agreement was terminated and the Company paid the Sponsors and Highfields an aggregate $30 million termination fee. During fiscal 2014, fiscal 2013 and fiscal 2012, we recognized expense of $35 million, $14 million and $13 million, respectively, related to management fees and reimbursement of out-of-pocket expenses. These expenses are included in related party expenses in the consolidated statements of comprehensive income.

 

The Blackstone Group owns a majority equity position in RGIS, an external vendor we utilize to count our store inventory. Payments associated with this vendor during each of fiscal 2014, fiscal 2013 and fiscal 2012 were $6 million, and are included in SG&A in the consolidated statements of comprehensive income.

 

The Blackstone Group owns a majority equity position in Vistar, an external vendor we utilize for all of the candy-type items in our stores. Payments associated with this vendor during fiscal 2014, fiscal 2013 and fiscal 2012 were $26 million, $24 million and $24 million, respectively, and are recognized in cost of sales as the sales are incurred.

 

The Blackstone Group owns a majority equity position in Hilton Hotels, an external vendor we utilize for hospitality services. Payments associated with this vendor were $1 million during fiscal 2014, minimal during fiscal 2013, and $1 million during fiscal 2012, and are included in SG&A in the consolidated statements of comprehensive income.

 

The Blackstone Group owns a majority equity position in Brixmor Properties Group, a vendor we utilize to lease certain properties. Payments associated with this vendor during fiscal 2014, fiscal 2013 and fiscal 2012 were $3 million, $4 million and $5 million, respectively. These expenses are included in cost of sales and occupancy expense in the consolidated statements of comprehensive income.

 

Our current directors (other than Jill A. Greenthal, John J. Mahoney, James A. Quella, Beryl B. Raff and Carl S. Rubin ) are affiliates of Bain Capital or The Blackstone Group. As such, some or all of such directors may have an indirect material interest in payments with respect to debt securities of the Company that have been purchased by affiliates of Bain Capital and The Blackstone Group. As of January 31, 2015, affiliates of The Blackstone Group held $50 million of our Restated Term Loan Credit Facility.