Toys 'R' Us preparing for possible bankruptcy filing - sources

[Right_in_Virginia]

Toys 'R' Us preparing for possible bankruptcy filing - sources
Reuters, Sep 15, 2017

Toys ‘R’ Us is working to put together a loan to fund its operations in a potential bankruptcy filing that could come before the holiday sales season, according to people familiar with the matter.

The toy merchant’s move underscores the deep distress rippling through retailers of all sizes as consumers increasingly shop online at sellers such as Amazon.com Inc (AMZN.O) or go to discounters such as Wal-Mart Stores Inc (WMT.N).

A spokeswoman for Toys ‘R’ Us did not immediately respond to a request for comment. The people could not be identified because the bankruptcy plans are not yet public.

The Wall Street Journal earlier reported that the company was considering filing for Chapter 11 protection in U.S. Bankruptcy Court in Richmond, Virginia. (on.wsj.com/2h87WOt)

There have been more than a dozen significant retail bankruptcies this year, but none for retailers as big as Toys ‘R’ Us, which has about $5 billion in debt and more than 1,600 stores worldwide.


More:  https://uk.reuters.com/article/uk-toys-r-us-bankruptcy/toys-r-us-preparing-for-possible-bankruptcy-filing-sources-idUKKCN1BR00K

[Right_in_Virginia]

A little more:

Part of the retailer’s current financial woes stem from vendors demanding tighter repayment terms over fears that Toys ‘R’ Us may file for bankruptcy, the people added. The tighter terms have added to the Wayne, New Jersey-based company’s cash crunch, they said. Toys ‘R’ Us tapped restructuring attorneys from Kirkland & Ellis LLP, CNBC reported this month.

This sounds like the start of a death spiral.  I hope not.

[catfish1957]

Chain chose to rely  on name instead of trying to be competitive.


Hope stockholders hold their management accountable.

[GtHawk]

I don't know about elsewhwere,  but I stopped going to Toys 'R' Us over five years ago. The ones local to me were a mess with aisles blocked with disorganized merchandise, loud music, not of a holiday theme but hip hop and the employees were if not rude, disinclined to do one iota over the minimum. Add that to the fact that even their sale prices were usually higher than Walmart or Target, I'm not surprised their on the slide to bankruptcy.

[Applewood]

Brick and mortar stores are all in serious trouble, thanks to Amazon and other online shopping.  A retailer must work extra hard thesec days to keep its customers and attract new ones.  The store that price gouges or treats the customers poorly is going to be the loser.  I have no sympathy for retailers who don't make the effort. 

[Oceander]

The Toys R Us near us has always been pretty decent; however, we haven't been there in a few years because we don't have little kids to buy toys for any more.