Geoffrey is back from the dead: New Toys R Us owners are thinking about physical stores next year

Hedge funds, which now owns the Toys R Us brand, plan to revive the toy retailer as an independent business next year, according to people close to the case.

Solus Alternative Asset Management and Angelo Gordon will seek to raise capital to help revitalize the retailer, which closed its last stores at the end of June.

Before opening their own stores, the funds team up with Kroger, the largest grocery store operator in the United States, to create Geoffrey Toy Box-based storylines in about 600 stores, according to two people. The areas inside the supermarkets will open during the holiday season and will sell a selection of branded toys such as Imaginarium and Journey Girls.

The most important plan is still in preparation, could change depending on the factors, including funding. Representatives of Angelo Gordon and Solus Alternative Asset Management made no comments.

Rebuilding the Toys R Us brand remains an arduous task, especially since the leases and distribution centers of the chain were sold during the liquidation. Although some retailers have found a second life after liquidation, they usually only have access online or as a section in another store.

Solus and his cohorts did not want to be merchants. The lenders assumed control of the Toys R Us and Babies R Us brands because the intellectual property was used as collateral for their loans, which the distressed retailer defaulted after filing for bankruptcy. The funds initially auctioned the intellectual property rights and then canceled the sale, arguing that their retention was better than the bids received.

However, the process prevented them from formulating a plan in time for the critical holiday shopping season. Many toy sellers now say that they simply moved on to something else.

The brand's revival plans, reported for the first time last month by Bloomberg, do not appeal to former workers, who allocate the funds to the liquidation of the company and the loss of 33,000 jobs.

"I'm just sick of that," said Cheryl Claude, a former assistant store manager from New Jersey protesting last month in front of the offices of Solus and Angelo Gordon in Manhattan.

It's not just workers who have been hurt by the absence of the company. Hasbro said during its call for results in October that the impact of the retailer's demise could persist for a few quarters. Mattel was also affected by the liquidation of his biggest client.