WAYNE, N.J. — Toys “R” Us, the giant toy store chain, has filed for bankruptcy protection for its U.S. and Canadian operations under Chapter 11 of the Bankruptcy Code in Richmond, Va. In addition, the Canadian subsidiary is seeking protection in parallel proceedings under the Companies’ Creditors Arrangement Act in the Ontario Superior Court.
Struggling to compete against online sellers, and saddled with debt of US$5 billion, the company intends to restructure and establish new financing “that will enable it to invest in long-term growth and fuel its aspirations to bring play to kids everywhere and be a best friend to parents,” the company said in a release. Its operations outside the U.S. and Canada are not part of the bankruptcy proceedings.
The stores will remain open during the process. “We are confident that we are taking the right steps to ensure that the iconic Toys “R” Us and Babies “R” Us brands live on for many generations,” said Chairman and CEO Dave Brandon.
