Bankrupt retailer Toys “R” Us Inc. is preparing to liquidate its U.S. operations and assets if it is unable to find a buyer or restructure its outstanding debt with lenders, according to a report on Thursday.
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Sources within the New Jersey-based company, which filed for bankruptcy last September, told Bloomberg that a shutdown of U.S. stores is seen as “increasingly likely” due to a lack of interest from potential buyers. Weak holiday results have exacerbated concerns about the chain’s ability to operate in the future.
Toys R Us representatives declined to comment on the report.
Like many traditional retailers, Toys R Us has struggled to maintain sales amid declining customer traffic in brick-and-mortar locations and the rise of e-commerce competitors like Amazon. In filing for bankruptcy last September, Toys R Us cited a heavy long-term debt load of more than $5 billion.
Toys R Us received a $3.1 billion loan to keep stores open after the bankruptcy. However, the chain also announced plans to shutter more than 180 stores this year, or roughly 20% of its U.S. operations.
The company’s struggles aren’t limited to its U.S. operations. Both its United Kingdom and European divisions have sought buyers in recent months.