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Toys ‘R’ Us to close in UK and U.S, spelling end for Australian arm

Embattled retail giant Toys ‘R’ Us has announced it will sell or close all of its U.S. and UK stores, with Australia’s 39 branches likely to follow. 

The chain filed for bankruptcy in the U.S in September and plunged into liquidation in the UK after failing to pay a AUD$26million tax bill.

CEO David Brandon is said to have told U.S. staff the company plans to file liquidation papers on Thursday and sell or close all 885 stores.

‘We’re putting a for sale sign on everything,’ Mr Brandon told employees during a conference call, according to The Australian. 

Embattled retail giant Toys ‘R’ Us has announced it will sell or close all of its U.S. and UK stores, with Australia’s 39 branches likely to follow. A UK store is pictured earlier this month

‘Frankly, all anyone has to do is offer one dollar more [than what is being offered by liquidation firms]… The last six months have been pure hell.’ 

When Toys ‘R’ Us first filed for US bankruptcy, its Australian arm said its 39 local stores would trade as normal.

But Mr Brandon is now said to have told staff the company was likely to liquidate not only in Australia, but also France, Spain, and Poland.

It also reportedly plans to sell its operations in Canada, Central Europe and Asia.

CEO David Brandon (pictured) is said to have told U.S. staff the company plans to file liquidation papers on Thursday

CEO David Brandon (pictured) is said to have told U.S. staff the company plans to file liquidation papers on Thursday

Toy ‘R’ Us’ executive vice president of global communications, Amy von Walter, told The Sydney Morning Herald the company’s Australian stores were ‘open and serving customers as usual’.

But Ms von Walter would not elaborate or comment on plans to liquidate Australian branches.

Toys ‘R’ Us Australia posted a $7.7 million loss in the financial year to January 2017 and a $9 million loss the previous year.

A financial report filed in 2016 warned that the future of the Australian arm of the business relied on the support of the U.S. company.  

Toy 'R' Us' executive vice president of global communications, Amy von Walter, said the company's Australian stores were 'open and serving customers as usual'

Toy ‘R’ Us’ executive vice president of global communications, Amy von Walter, said the company’s Australian stores were ‘open and serving customers as usual’

‘Should the support be withdrawn or not continue, there is significant uncertainty whether the company or consolidated entity will be able to continue as going concerns,’ the report read.   

The U.S. company experienced some renewed success under Mr Brandon, who since 2015 has sought to make Toys ‘R’ Us the destination for children that it once was.

But his changes ultimately proved futile in the face of the online retailing competition from the likes of Amazon, Walmart and Target. 

Now, the $11 billion in sales still happening at Toys R Us each year will disperse to other retailers and online discounters, analysts say. 

'We're putting a for sale sign on everything,' Mr Brandon (pictured) reportedly told employees

‘We’re putting a for sale sign on everything,’ Mr Brandon (pictured) reportedly told employees

GlobalData Retail estimates that nearly 14 percent of toy sales were made online in 2016, more than double the level five years ago. 

Toys ‘R’ Us has more 1,500 stores globally which employ around 60,000 people, including nearly 3,000 in Australia.

All 75 stores in the UK are expected to will close within six weeks. 

All 75 stores in the UK are expected to will close within six weeks. A closing down sign is picutred outside the Toys R Us store in Coventry, Britain

All 75 stores in the UK are expected to will close within six weeks. A closing down sign is picutred outside the Toys R Us store in Coventry, Britain



Read more at DailyMail.co.uk