Toys 'R' Us forced to file for USA bankruptcy

Ivan Schwartz
September 21, 2017

First it was Sears, Then K-Mart, JC Penney's and now Toys 'R Us is the latest large retailer to file for chapter 11 bankruptcy protection.

Toys "R" Us Canada wants to continue to pay its foreign suppliers, while leaving its North American suppliers to collect whatever money is left at the end of the insolvency process, according to documents filed Tuesday in Ontario Superior Court.

The Toys R Us store at Copdock, Ipswich.

The timing could not be worse.

The filing comes just as the retailer is gearing up for the holiday shopping season, which accounts for the bulk of its sales.

The company has received a commitment for over three billion USA dollars in debtor-in-possession financing from various lenders, including a JP Morgan-led bank syndicate and certain of the Company's existing lenders.

Workers have been instructed to inform them that stores will continue operating normally, reiterating what the company has said. The chapter 11 protections will help out the company during the upcoming holiday season.

Mattel's shares dropped 6.2 percent on word that Toys "R" Us was planning for bankruptcy. Toys " R " Us, Canada operates 82 stores across the country.

Magnitude Earthquake Rocks Mexico City
Below you see a graph published by CNN based on the information of the US Geological Survey , with the intensity of this quake . Its epicentre was 4.5 km east-northeast of San Juan Raboso and 55 km south-southwest of the city of Puebla , in Puebla state.

Kevin Hart's alleged sex tape partner stages press conference
Speaking in a self-shot video, Kevin said: "I'm at a place in my life where I feel like I have a target on my back". Montia Sabbag says she had nothing to do with the video recordings of her and Hart.

Fulham experience means Hodgson will not panic at Palace
Roy Hodgson secured his first victory as Crystal Palace manager as they beat Premier League rivals Huddersfield in the third round of the Carabao Cup.

The company said the proceedings are a way for Toys "R" Us to work with its creditors on restructuring the debt beleaguering it.

"It's the only showroom available". Toys "R" Us backed MGA's collectible L.O.L. Surprise Dolls, making a big order, placing it at the front of stores in January. Toys R Us had, to this day, one of my favorite ways to buy video games; the video game ticket wall. Lego is laying off 1,400 workers after saying profits and sales dropped in the first half.

Will Toys "R" Us and Babies "R" Us continue to run typical sales and promotions? "I really believe that", said Larian.

Private equity firms Bain Capital and KKR & Co LP and real estate investor Vornado Realty Trust now own the toy seller, but the retailer will have new owners once it emerges, Brandon said.

"Today marks the dawn of a new era at Toys R Us where we expect that the financial constraints that have held us back will be addressed in a lasting and effective way", Chief Executive David Brandon said in a statement.

With our favourite toy store filing for bankruptcy protection, are we slowly becoming a generation that replaces Hot Wheels, Legos and Unos with iPads and laptops? Among them were Perfumania Inc, apparel chains rue21 Inc and Gymboree Corp, discount shoe chain Payless Holdings LLC and designer clothing chain BCBG Max Azria Global Holdings LLC.

This has been its biggest problem for the last 12 years and show why it has failed to deliver a profit in the last four years, particularly given how margins have continued to come under pressure in an age of intense competition from the likes of Amazon, and other USA retailers like Wal-Mart.

Other reports by GizPress

Discuss This Article

FOLLOW OUR NEWSPAPER