Toys ‘R’ Us prepares to shut a quarter of its UK stores

Toys R Us is preparing to shut a quarter of its UK stores, with the loss of hundreds of jobs.

The news comes ahead of the busy Christmas period, a crucial time for high street retailers which have been struggling to compete with online shopping.

The toy retailer, which has been a family favourite since the 1980s, could close at least 25 of its 105 stores.

The company is preparing to launch a process called a company voluntary agreement as early as next week, which will require the approval of 75 per cent of its shareholders.

Toys R Us says its stores will remain open during the Christmas period and into the New Year, but the news paints a desperate picture for the business.

In September, the company’s US arm filed for bankruptcy protection in order to restructure debts of £3.7 billion. 

The move was used as a guarantee that the retailer’s suppliers would be paid ahead of Christmas. At the time, the firm insisted that its UK stores were safe.

The toy retailer, which has been a family favourite since the 1980s, could close at least 25 of its 105 stores

Retail analyst Richard Hyman said: ‘The vast majority of UK retailers have too many stores. Many have closure programmes that tend to be modest.

‘When an event triggers a bigger intervention, as with Toys R Us, a more realistic closure plan can emerge and this is what we are seeing here.’

Toys R Us recorded a loss of £500,000 in the year to January. It is understood to have made a loss in seven of the past eight years.