Toys 'R' Us files for Chapter 11 bankruptcy protection
On Monday night, Toys 'R' Us announced that it is following Kay Bee Toys and FAO Schwartz into bankruptcy court, but said that unlike its onetime rivals, it hopes to emerge intact. The company, struggling with $5 billion in long-term debt and competition from online retailers like Amazon and discount stores like Walmart, filed for Chapter 11 protection in U.S. federal court, plus the Canadian equivalent for its Canadian operations. It emphasized that all of its brick-and-mortar and online stores will remain open through the crucial holiday shopping seasons, and said its 810 stores and 255 licensed outlets outside North America will be unaffected by the bankruptcy reorganization.
"The company's approximately 1,600 Toys 'R' Us and Babies 'R' Us stores around the world — the vast majority of which are profitable — are continuing to operate as usual," Toys 'R' Us said in a statement. It did not say what will happen to its 65,000 employees worldwide or its retail stores, but some of its 885 U.S. locations are expected to be closed in the reorganization.
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