Senior lenders to Toys “R” Us Inc. will make an opening bid of $760 million for the bankrupt retailer’s Asia operations, far less than the $1 billion offers the company touted just a few months ago, Bloomberg News reported. The lenders would make a so-called "credit bid" by using their senior secured notes in the Asia business rather than cash, and win ownership of the unit during an auction next month in New York, according to court documents filed Saturday. Noteholders eligible to participate include York Capital Management Global Advisors LLC, Barclays Bank Plc and Cerberus Capital Management LP, related court papers show. Before an auction is scheduled, Toys wants a U.S. federal judge to strip the company’s minority partner in Asia, Fung Retailing Ltd., of its right-of-first-refusal purchase option as well as forcing Fung to agree to sell its 15 percent stake in the joint venture. Toys’s 12 percent first-lien bonds that mature in 2021 fell more than 5 cents to 70.5 cents on the dollar on Monday, the biggest drop since they were issued in 2016, according to Trace bond price data. In April, a lawyer for Toys told the judge overseeing the company’s bankruptcy that it had multiple bids worth more than $1 billion for the Asia business. Toys owns nearly 85 percent of the venture and Fung owns the rest. Read more.
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