Toys “R” Us has voluntarily filed for Chapter 11 bankruptcy protection ahead of the key holiday shopping season.
The toy retailer is struggling with $5 billion in debt and intense online competition, according to the Associated Press.
On the First Coast, Toys “R” Us has locations at the Markets at Town Center and in Orange Park. In St. Augustine, there is a Toys “R” Us at the St. Augustine Outlet.
A standalone Babies R Us, which is an offshoot of Toys "R" Us, is located on Argyle Forest Boulevard on the Westside of Jacksonville.
Based on the company’s corporate statement, all the stores are expected to remain open.
There are 1,600 Toys ”R” Us and Babies “R” Us stores around the world – the vast majority of which are profitable, according to the company and they will continue to operate as usual. A list of unprofitable stores wasn’t provided.
The company said the proceedings are a way for Toys “R” Us to work with its creditors on restructuring the debt beleaguering it. And it emphasized that its stores worldwide will serve customers while it works with suppliers and sells merchandise.
“Today marks the dawn of a new era at Toys“R”Us where we expect that the financial constraints that have held us back will be addressed in a lasting and effective way,” said Dave Brandon, Chairman and Chief Executive Officer in a statement on the company’s corporate website.
The Company has received a commitment for over $3.0 billion in debtor-in-possession (“DIP”) financing from various lenders, including a JPMorgan-led bank syndicate and certain of the Company’s existing lenders, which, subject to Court approval, is expected to immediately improve the Company’s financial health and support its ongoing operations during the court-supervised process.
Toys“R”Us said in a statement it is committed to working with its vendors to help ensure that inventory levels are maintained and products continue to be delivered in a timely fashion.
You can read the toy retailer’s full statement here.
Bill Bortzfield can be reached at bbortzfield@wjct.org, 904-358-6349 or on Twitter at @BortzInJax.