Toys ‘R’ Us Inc. said on Tuesday it will close about 180 U.S. stores in the coming months, as part of a reorganization plan to emerge from one of the largest ever bankruptcies by a specialty retailer, according to a court filing.
In September, just ahead of the 2017 holiday season, the world’s largest toy chain filed for protection from its creditors, a response to years of dull results and a $5 billion of long-term debt. The announcement casting doubts over the future of its 64,000 employees and nearly 1,600 stores.
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In Canada all 83 Toys ‘R’ Us stores will remain open, said president of the Canadian unit, Melanie Teed-Murch, in a letter to customers.
The closure of about 20 percent of its stores in the United States, which needs court approval, will begin in early February and continue until mid-April, Chief Executive David Brandon said in a letter on its website.
The company said it plans to reinvent its stores by converting them into co-branded Toys R Us and Babies R Us stores and websites as a way to exit bankruptcy in 2018.
Toys ‘R’ Us, which also operates the infant- and toddler-focused Babies ‘R’ Us chain, has set aside more than $400 million out of its $3.1 billion in bankruptcy loans for sprucing up stores over the next three years with more experiences and better-paid staff, Reuters reports.