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Economy

With $400. million in red ink, Toys R-Us could soon be history

2017-09-19

[CBS] Toys R Us has hired a law firm to help restructure its roughly $400 million in debt due in 2018, a move that could include the marquee toy store filing for bankruptcy protection, sources familiar with the situation said Wednesday.

Addressing the retailer's debt load prior to the crucial holiday season could give its major vendors such as Mattel and Hasbro clarity into the company's long-term viability to help ensure the toymakers continue to stock its shelves throughout the holidays.

Toys R Us has hired restructuring lawyers at Kirkland & Ellis to help address the looming payments, the people said.

Hiring a law firm like Kirkland is not indicative of a bankruptcy filing, and many companies work with law firms to successfully refinance or restructure their debt without filing for protection.

Update from Reuters at 10:50 a.m. EDT: they filed for Chapter 11 bankruptcy.

Posted by:Besoeker

#7 My friend from the UK calls their merchandise Chinese Landfill $h!t.

Posted by: Alaska Paul 2017-09-19 17:58

#6 ...too late to cancel those Xmas toy orders from the mainland?

Posted by: P2Kontheroad 2017-09-19 17:54

#5 There's another notch in the old Chinese belt.

Posted by: Skidmark 2017-09-19 16:36

#4 It's profitable before interest payments, so it will survive. The equity owners and unsecured debt holders will probably need to take a haircut. The LBO simply piled on too much debt based on record low interest rates. The LBO investors got way too greedy. They should have completed a stock offering to lighten the debt load. Now they'll have to deal with an involuntary restructuring, because panicky vendors cut off their air supply. This isn't an Amazon problem - it's a private equity LBO problem triggered by over-optimistic spreadsheet jockey assumptions, probably dictated by senior partners at the private equity firms involved.

Posted by: Zhang Fei 2017-09-19 16:01

#3 Looks like the Toys R Us kids finally grew up.

Posted by: Deacon Blues 2017-09-19 12:54

#2 tough retail space

Juvenile Sales went under in the early 90s.

people used to park their kids there for an hour while doing a medical appt or something and then not buy anything when they picked the kid up

Posted by: lord garth 2017-09-19 12:30

#1 ...Toys R Us was unpleasantly overpriced forty years ago, and it hasn't gotten any better - I've been in once in the last twenty years, to pick up a gift for my grandson which we ordered online for pickup.

And they screwed it up.

I can get the same stuff from Amazon 20% (or better) cheaper and not have to deal with deranged crowds and dead-souled employees.

Mike

Posted by: Mike Kozlowski 2017-09-19 04:55

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