Toy store chain Toys R Us is planning to sell or close all 800 of its U.S. stores, affecting as many as 33,000 jobs as the company winds down its operations after six decades, according to a source familiar with the matter.
The news comes six months after the retailer filed for bankruptcy. The company has struggled to pay down nearly $8 billion in debt - much of it dating back to a 2005 leveraged buyout - and has had trouble finding a buyer. There were reports earlier this week that Toys R Us had stopped paying its suppliers, which include the country's largest toy makers. On Wednesday, the company announced it would close all 100 of its U.K. stores.
In the United States, the company told employees closures would likely occur over time, and not all at once, according to the source, who spoke on the condition of anonymity because they were not authorized to discuss internal deliberations.
Toys R Us has stores in the Town of Wallkill and at the Woodbury Common Premium Outlets. It previously had announced it was closing its store in the Town of Ulster.
Toys R Us, once the country's preeminent toy retailer, has been unable to keep up with big-box and online competitors. The recent holiday season dealt another blow to the embattled company, which struggled to find its footing even as the retail industry racked up its largest gains in years. In January, Toys R Us announced it would close 182 U.S. stores, or about one-fifth of its remaining locations.
A group of toy makers led by MGA Entertainment, the giant behind brands such as L.O.L. Surprise!, Little Tikes and Bratz, on Wednesday submitted a bid to buy Toys R Us' Canadian arm, which includes 82 stores, according to Isaac Larian, MGA's chief executive. He added that he is also looking into buying as many as 400 U.S. stores, which he would seek to operate under the Toys R Us name.
"There is no toy business without Toys R Us," Larian said. "It's a big deal and I'm going to try to salvage as much of it as possible."