Over the past few weeks, word was going around that everyone’s favourite toy shop Toys ‘R’ Us was on its way to bankruptcy.
The rumours turned out to be true.
On Monday, Toys ‘R’ Us reportedly filed for bankruptcy protection in a desperate attempt to save the company from mounting debts.
Toys ‘R’ Us made the official announcement after facing pressures from suppliers.
According to CNBC, the global toy retailer is currently facing almost USD5 billion (RM21 billion) in debt, USD400 million (RM1.67 billion) of which has interest payments due in 2018, and USD1.7 billion (RM7.1 billion) in 2019.
This filing and new financing procedure was reportedly a move to improve the company’s financial health and manage operations during the bankruptcy process, especially during the hectic holiday season coming up soon.
However, the bankruptcy proceedings were reportedly filed only in the United States and Canada. That means it’s somewhat good news for us because Toy ‘R’ Us operations in Australia, Europe and joint venture in Asia are not part of the bankruptcy proceedings!
The 1,600 Toys ‘R’ Us and Babies ‘R’ Us stores around the world will continue to operate as usual, including Malaysia!
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Toys ‘R’ Us stores outside the U.S. and Canada are not affected.
So parents (and kids), you can keep calm and carry on shopping.
The retailer has always been a key player in the toy industry in the U.S. But ever since competitors like Amazon, Walmart and Target came into the picture, this cast a shadow on Toys ‘R’ Us.
So from now on, the company has redirected its focus to online sales with its newly launched web stores, as well as revamping its Babies ‘R’ Us business.
Let’s all hold our children’s hands and hope that Toys ‘R’ Us will come back stronger from all this because some of us still love shopping there!