Bankrupt American toy store chain Toys “R” Us will probably be brought to life again: the planned sale of the trademark rights was cancelled and creditors now want to establish a new retail group.
Creditors will keep Toys “R” Us for themselves
Based on the existing licences and armed with the well-known brand name, the lenders who got their hands on Toys “R” Us (and sibling Babies “R” Us) when they went bankrupt, now want to start up a new retail business, Bloomberg, has discovered in judicial documents. Originally, they were planning to sell the remaining intellectual property, so that a purchaser could use the name Toys “R” Us. A group of creditors has now revoked this: they prefer to set out themselves with the remains of the retail chain, including the name and possibly even the the brand mascotte, Geoffrey giraffe.
Placing the brand in a new, independent company in the United States is the best option for all stakeholders, they say (as in: the creditors fear that a sale will not generate enough profit). They would much rather give it a try themselves, even if there is still disagreement amongst the creditors. This possible relaunch of Toys “R” Us has led to disputes in Asia about the amount of Asian outlets which will now have to pay to be able to further use the brand name.
Too late for the holiday period
Those same creditors gave a lot of criticism on the dismantling of Toys “R” Us in the wake of the bankruptcy. Unions and interest groups have been campaigning since the closure of the outlets against the way the current owners have been firing employees. They demand a compensation fund for ex-employees.
Starting over will require heavy investment, as all distribution centres and outlets have already been sold. The question also remains whether the suppliers will be willing to make a fresh start with the new toy chain. It will probably be too late to realise the startup before the lucrative end of year period, which is usually the source of more than a third of Toys “R” Us' yearly turnover.