Global toy giant Toys ‘R’ Us has filed for bankruptcy protection in the USA and Canada, according to reports.
The retailer, which has more than 1,600 stores worldwide, including one store on Chester’s Greyhound Park, has long been struggling against online rivals such as Amazon and discount chains.
They last night confirmed that the North American arm of the retailer was seeking “Chapter 11 protection” from the US Bankruptcy court, which will allow the firm to restructure its business in order to tackle its debts.
At the moment there is no suggestion that the move will impact on stores in the UK
Neil Saunders, retail research agency and consulting firm GlobalData Retail managing director, said: “The past decade has seen a dramatic change in the domestic toy market with new channels, increased competition, and new technology all having a deleterious impact on the sector and traditional toy stores.
“Unfortunately, Toys ‘R’ Us has not responded effectively to these challenges.”
The company is currently looking to online sales to secure its future, with recently launched web stores for its products.
According to BBC News, Toys ‘R’Us – which also opened a branch in Broughton last year – say the new financing will improve the company’s financial health and support its operations during the court-supervised bankruptcy process.
Chief executive Dave Brandon said: “Our objective is to work with our debt holders and other creditors to restructure the $5bn of long-term debt on our balance sheet, which will provide us with greater financial flexibility to invest in our business.”