According to court documents filed today, Toys ‘R’ Us’ efforts as a business to stay afloat have failed, and as a result all 735 stores open in the United States will either be sold or shut down. Amid the closings, around 31,000 employees will lose their jobs.
This follows news last year that Toys ‘R’ Us had filed for bankruptcy in an effort to turn around over $5 billion in debt. The company was spending around $400 million a year just in trying to address that debt, making profit margins threateningly low. The following January, 182 stores were closed, as the bankruptcy did not see big enough results.
The court filings stated the company had a “horrific” holiday season, making $250 million below expectations and only a quarter of what was pulled in the previous year. Hundreds of millions would have to be spent to keep stores open, and no buyers came forward to attempt to revive the brand.
In order to pay back creditors, Toys ‘R’ Us is liquidating all of its assets. Everything will be for sale. Stores will generally stay open for at least two months, but store closures have been filed. Stores in the UK are also closing, but the company does plan to continue operation in markets such as Canada and Asia.
Source: CNN