Toys R Us files for bankruptcy
"Dawn of a new era" for one of world's foremost toy retailers as Chapter 11 filed in US and Canada
Toys R Us has filed for bankruptcy in the US and Canada in a move to restructure debts of £3.7b and set a path for investment in long-term growth.
The toy retailer, which has around 1,600 stores globally, said the Chapter 11 filing would impact only its business in North America, highlighting Asia and the UK as unaffected.
"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," said Dave Brandon, the retailer's Chairman and Chief Executive Officer. "Together with our investors, our objective is to work with our debtholders and other creditors to restructure the $5 billion of long-term debt on our balance sheet, which will provide us with greater financial flexibility to invest in our business, continue to improve the customer experience in our physical stores and online, and strengthen our competitive position in an increasingly challenging and rapidly changing retail marketplace worldwide. We are confident that these are the right steps to ensure that the iconic Toys"R"Us and Babies"R"Us brands live on for many generations."
A statement released by Toys R Us said it had received a commitment for more than $3b (£2.2b) in debtor-in-posession financing from various lenders, including a JPMorgan-led bank syndicate and a number of other current lenders.
The statement added that the toy retailing giant "is committed to working with its vendors to help ensure that inventory levels are maintained and products continue to be delivered in a timely fashion".