Word came this morning that the Toys ‘R’ Us U.K. subsidiary was unable to find a buyer and will close all stores within six weeks. From BBC News:
This announcement was expected after the subsidiary entered administration. Now that it has come to pass it carries the air of inevitability given the complexity of the Toys ‘R’ Us business arrangements and a wave of retail failures in Britain. Other reports from Britain indicate that layoffs at the stores started as soon as the announcement was made.
Meanwhile in the U.S. a bankruptcy liquidation court filing is expected early this evening. That plan would most likely lead to the closing of the remaining U.S. Toys ‘R’ Us stores and the web store.
There is a chance that stores in Canada could stay open. According to Bloomberg, toy manufacturer MGA (owner of Bratz) is trying to find investors to fund a bid for the Canadian operations, which are also in bankruptcy but have not faced quite the same level of operational stress as the U.S. and U.K. companies. Such a bid could also include a few U.S. stores and the web store. Time is short, though, and a credible bid might not be forthcoming if partners for the venture cannot be lined up by tonight.
Toys ‘R’ Us acknowledged the long odds it faces when it told employees late today that probably all U.S. stores, some 800, will close, and all employees, more than 30,000, will lose their jobs.
Update: Toys ‘R’ Us filed its petition to liquidate after midnight. The petition implies a quick liquidation of most stores. It suggests that there is a good chance that all Canadian stores remain open. USA Today: