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Toys R Us has been sold again – the latest effort to revive the famous but struggling brand amid a boom in toy sales.
The once powerful retailer that filed for bankruptcy protection in 2017 amid growing debt is now owned by WHP Global, the brand licensing company that owns Ann Klein and Joseph Abboud.
WHP Global has acquired a controlling stake in Tru Kids, which owns Toys R Us and Babies R Us, the company said on Monday. Financial terms of the deal were not disclosed.
TOYS R US TO RECOGNIZE AGAIN, CLOSE ITS LAST 2 STORES IN THE UNITED STATES
“We are delighted to take the reins of the world’s leading toy brand at a time when the category is up 16% and consumer demand for toys is at an all time high,” said WHP CEO Yehuda Shmidman in a statement. “This is a natural fit for WHP as we can leverage our global network and digital platform to help grow Toys R Us and Babies R Us around the world.”
Shmidman told CNBC he plans to expand the 70-year-old retailer founded by Charles Lazarus and made famous by its mascot, Geoffrey the Giraffe, by opening physical stores again.
Toys R Us has been sold again – the latest effort to revive the famous but struggling brand amid a boom in toy sales. (Photo by Tim Boyle / Getty Images)
But the hurdles to getting there are greater than ever as the void left by Toys R Us – once the nation’s largest toy seller – has since been filled by big box retailers like Walmart and Target as well as the supermarket giant. Amazon e-commerce.
“Toys R Us is one of the biggest brands in the world,” said Gerald Storch, who was formerly the company’s chief executive. “But the challenge is that the market share is already split between Amazon, Walmart, and Target.”
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Shmidman, who previously tried to buy out the brand in bankruptcy, sources say, has been vice president of Tru Kids since 2019. His business is backed by a $ 350 million equity commitment from funds backed by Oaktree. Capital Management and by BlackRock.
The Toys R Us and Babies R Us brands were bought by private equity investors Solus Alternative Asset Management and Ares Management, who hoped to resurrect the chain by opening smaller stores across the country before the plan was scrapped. by the pandemic.
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 overseas licensing rights, where Toys R Us and Babies R Us generate more than $ 2 billion in sales from some 900 stores and e-commerce sites in Canada, in Asia, Africa and the Middle East, according to WHP.
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