Toys “R” Us Inc. received bankruptcy court approval Thursday to wind down its U.S. business and close the remainder of its more than 700 stores, WSJ Pro Bankruptcy reported. The liquidation sales are expected to begin as early as Friday throughout the U.S. The closure of the iconic toy stores will leave up to 33,000 Americans without jobs. Toys “R” Us is still holding out hope that some of its U.S. stores will survive, however, according to court papers. Toys “R” Us also won approval from Judge Keith Phillips of the U.S. Bankruptcy Court in Richmond, Va., to put its Canadian business up for sale. The Canadian sale process comes with the option to add on 200 U.S. stores — the best-performing side-by-side Toys “R” Us and Babies “R” Us stores — in hopes of keeping the American chain alive. Last week, Toys “R” Us announced it would close its entire U.S. chain after hopes of reorganizing the company’s hefty debt load and surviving the bankruptcy filing were diminished after disappointing holiday sales. Read more.
In related news, charles Lazarus, the founder and original CEO of Toys “R” Us, died yesterday at the age of 94, FoxBusiness.com reported. Lazarus opened a children’s furniture store in 1948 and founded the original incarnation of Toys “R” Us in 1957. He served as the chain’s CEO until 1994. Read more.
Occupancy issues are at the heart of many significant retail cases, as detailed in the forthcoming ABI publication Retail and Office Bankruptcy: Landlord/Tenant Rights, available for pre-order at the ABI Store.
Explore various strategies on how the tough times ahead for clients in the newspaper, brick-and-mortar retail or coal industries can be addressed in a bankruptcy, whether through a restructuring or a wind-down and liquidation of the company. Make sure to attend the "Obsolescence as a Catalyst" session at the Annual Spring Meeting.
