Toys ‘R’ Us secures approval from court to wind down U.S. operations

By Caroline Salls

Pittsburgh, March 22 – Toys “R” Us, Inc. received court approval to begin the process of conducting an orderly wind-down of its U.S. business and liquidation of inventory in all 735 of the company’s U.S. stores, including stores in Puerto Rico, according to an order filed Thursday with the U.S. Bankruptcy Court for the Eastern District of Virginia.

As previously reported, the company said it is also pursuing a going-concern reorganization and a sale process for its Canadian and international operations in Asia and Central Europe, including Germany, Austria and Switzerland. Toys “R” Us’ international operations in Australia, France, Poland, Portugal and Spain are considering their options in light of the winddown announcement, including potential sale processes in their respective markets.

In connection with the sale process, the company disclosed that it is in discussions with interested parties for a transaction that could combine up to 200 of the top performing U.S. stores with its Canadian operations.

While discussions continue on this potential transaction, Toys “R” Us said it sought court approval to implement the liquidation of inventory in all the U.S. stores, subject to a right to recall any stores included in the proposed Canadian transaction.

Toys “R” Us said last week that it is implementing a transition services arrangement for the next 60 days and is developing plans for a potential shared service function to support the international operations going forward.

Toys “R” Us is a Wayne, N.J., toy retailer. The company filed for bankruptcy on Sept. 19, 2017 in the U.S. Bankruptcy Court for the Eastern District of Virginia under Chapter 11 case number 17-34665.

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