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Toys R Us has been sold again – the latest attempt to revive the famous but struggling brand amid a boom in toy sales.
The once powerful retailer that filed for bankruptcy protection in the midst of increasing debt in 2017 is now owned by WHP Global, the trademark licensing firm owned by Ann Klein and Joseph Abboud.
WHP Global has acquired a majority stake in Tru Kids, which owns Toys R Us and Babies R Us, the company said Monday. Financial terms of the transaction were not disclosed.
TOYS R LOCKS AGAIN, CLOSES HIS LAST 2 US STORES
“We are delighted to take the reins of the world’s leading toy brand at a time when the category is growing by 16 per cent and consumer demand for toys is peaking,” EAP chief Yehuda Shmidman said in a statement. statement said. “This is of course appropriate for EAP, as we can leverage our global network and digital platform to grow Toys R Us and Babies R Us around the world.”
Shmidman told CNBC that he intends to grow the 70-year-old retailer founded by Charles Lazarus, made famous by his mascot, Geoffrey the giraffe, by reopening physical stores.
Toys R Us has been sold again – the latest attempt to revive the famous but struggling brand amid a boom in toy sales. (Photo by Tim Boyle / Getty Images)
But the hurdles to doing so are greater than ever, as the gap left by Toys R Us, formerly the country’s largest toy retailer, has since been filled by retailers such as Walmart and Target, as well as the e- retail giant Amazon.
“Toys R Us is one of the largest brands in the world,” said Gerald Storch, former CEO of the company. “But the challenge is that market share is already divided between Amazon, Walmart and Target.”
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Shmidman, who according to sources previously tried to buy the brand out of bankruptcy, has been vice chairman of Tru Kids since 2019. Its business is backed by a $ 350 million equity commitment from funds backed by Oaktree Capital Management and by BlackRock.
The brands Toys R Us and Babies R Us were bought by private investors Solus Alternative Asset Management and by Ares Management, which hoped to resurrect the chain by opening smaller stores across the country before the plan was sidelined by the pandemic. set.
Two stores in New Jersey and Texas that opened in 2020 were quietly closed in 2021.
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The vast majority of Tru Kids’ revenue comes from licensing fees abroad, where Toys R Us and Babies R Us generate more than $ 2 billion in sales from approximately 900 stores and e-commerce sites in Canada, Asia, Africa and the Middle East. East. according to EAP.