The future of Toys ‘R’ Us UK — and thousands of jobs — has been thrown into fresh doubt just weeks after creditors approved a radical rescue plan. This report from Toy World Mag via Sky News….
As reported by Sky News, Toys R Us’ stricken American parent has begun an urgent search for a buyer amid suggestions that poor Christmas trading has left the British business facing cashflow issues.
Sources said on Wednesday night that advisers at Alvarez & Marsal and Lazard, which are overseeing the chain’s bankruptcy protection process in the US, have sounded out potential buyers for the UK operations in recent days.
One insider said the company, which currently employs about 3,200 people in Britain, was looking to seal a sale within weeks.
The search for another owner will raise urgent questions about the fate of Britain’s biggest toy retailer if new investment cannot be found, with administration said to be a possible outcome.
That prospect will dismay about 2,400 UK workers who thought their jobs had been salvaged when a CVA was approved by creditors just three days before Christmas.
In a statement issued on Wednesday night, a Toys R Us UK spokesman told Sky News: “The US business is exploring a number of options as it develops plans to exit Chapter 11. These conversations are confidential but I can assure you that they are acting in the best interests of employees, business partners, shareholders and lenders.”
It is unclear whether any new owner would be bound by the pension commitments agreed as part of the CVA.
Retail industry sources said it was conceivable that buyers would emerge for the UK operations of Toys R Us, but it was unclear whether any party acquiring the business would be content with the scale of the existing restructuring plan.
More as we get it.
