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Dec
2017
Tuesday 5th
posted by Peter Lazenby in Britain

STRUGGLING US retail chain Toys R Us yesterday confirmed plans to close 26 of its British stores, putting 800 jobs in jeopardy.

The closures, which will happen early next year, represent one-third of the firm’s 84 permanent outlets in Britain.

The firm, which employs 3,200 people, said that some of those affected by the closures may be redeployed to other stores but made no assurances.

Toys R Us managing director Steve Knights said the warehouse-style stores opened by the retailer in the 1980s and 1990s have proven “too big and expensive to run.”

Mr Knight said the firm had launched a company voluntary arrangement (CVA), which allows a company to pay off its debts while continuing to trade.

On December 21, Toys R Us will ask its creditors to approve the CVA plan.

The announcement comes just months after the retailer filed for bankruptcy protection in the US and Canada as it battled mammoth debts and increasing competition online.

The toy retailer has struggled with debt since private equity firms Bain Capital, KKR & Co and Vornado Realty Trust bought it out in 2005, with experts saying that high levels of borrowing have held the group back from investing in its business.

The company, which dates back to the 1950s, was being lined up for a stock market flotation, but the plans were scuppered by weak financial performance.

Toys R Us arrived in Britain in 1985 with just five stores, launching its regional website 11 years later in 1996.




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