Toys “R” Us shutting U.S. stores, liquidating inventory – CBS, 2018/03/15
Toys “R” Us is going out of business in the U.S. The iconic chain announced early Thursday that it’s seeking bankruptcy court approval to start closing its 735 U.S. stores and liquidating their inventory.
Some 33,000 employees will lose their jobs as a result.
Toys “R” Us, which declared bankruptcy in September, was unable to convince creditors to refinance its more than $5 billion in debt, a crushing load that experts say hampered its ability to adapt to the growth in online shopping, among other consumer trends.
The chain was hobbled by debt stemming from the 2005 leveraged buyout by KKR, Bain Capital and Vornado Realty Trust (VNO). That deal placed it at disadvantage against larger rivals such as Amazon (AMZN), Walmart (WMT) and Target (TGT), which have made inroads in the toy market in recent years.
Toys “R” Us closing leaves workers, customers hanging – CBS, 2018/03/15
The company’s current leadership only compounded its mistakes by failing to act quickly and decisively. One example: When Toys “R” Us first declared bankruptcy in September, CEO Dave Brandon vowed not to close any stores, blithely remarking that “today marks the dawn of a new era at Toys “R” Us.” He was wrong.
The bankruptcy filing doesn’t cover Toys “R” Us’ international business, but it’s struggling, too. The company’s U.K. business on Wednesday announced that it is closing its doors after failing to find a buyer — about 3,000 people will lose their jobs. Toys “R” Us is considering combining as many as 200 of its top-performing U.S. stores with its Canadian operations, but Selbst said that would be complicated, expressing doubt it will fly.