Update: Toys R Us plans to sell or close all 800 of its U.S. stores

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NEW YORK (AP) - UPDATE 3/14/18 8:30 PM

Toys R Us's management has told its employees the company will sell or close all 800 of its U.S. stores.

That's according to a toy industry analyst who spoke to several employees who were on the call Wednesday.

Jim Silver, a toy industry expert, says Toys R Us's CEO told employees the plan is to liquidate all of its U.S. stores and after that, it could do a deal with its Canadian operation to run some of its U.S. stores.

The company declined to comment.

The chain filed for Chapter 11 bankruptcy protection last fall, saddled with debt that hurt its attempts to compete.

It pledged then to stay open, but had weak sales during the critical holiday season. In January it announced plans to close about 180 stores.

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ORIGINAL STORY 01/24/18 9:31AM

Toys R Us, which declared bankruptcy in September, is looking to close down as many as 182 outlets across the country, according to a court filing late Tuesday.

All of the company's stores in West Virginia, including one in Vienna, are staying open, but several in Ohio are targeted for closing, including locations in Western Hill, Dayton, Miamisburg-Centerville, Mentor and Dublin.

The news comes after a brutal year for retailers in the U.S. in which store closings across the country hit a record.

Over nearly seven decades in business, Toys "R" Us has built up 1,600 stores around the world. About 880 of them are in the U.S.

The filing Tuesday said the decision to shut so many stores was prompted by increased competition and a shift by customers toward online shopping.

The planned closures, which need court approval, are expected to begin in early February and be mostly completed by the end of April, Toys "R" Us CEO Dave Brandon said in a message to customers posted on the company's website.

"The actions we are taking are necessary to give us the best chance to emerge from our bankruptcy proceedings as a more viable and competitive company," he said.

Several other stores will be converted into co-branded Toys "R" Us and Babies "R" Us outlets, Brandon added.

Toys "R" Us stores outside the U.S. are unaffected.

Melanie Teed-Murch, president of Toys "R" Us Canada, said in a statement that all 83 locations there would continue operating as usual.

Toys "R" Us has suffered from fierce competition from fellow retailer Walmart and online giant Amazon that left it reeling under $5 billion in debt.

The company's same-store sales fell 4.4% in the quarter ended October, with its U.S. stores experiencing a sharper drop of 7%. The toy industry at large is also facing headwinds, with key manufacturers like Lego and Mattel struggling with declining sales.



 
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