Toys R Us’ embattled US arm is planning to pull the shutters on 200 more stores as its UK operation struggles to find funds to meet a looming debt deadline.
According to the Wall Street Journal, the struggling toy retailer is discussing plans to demonstrate to investors that it can avoid total collapse.
It is understood that one of these plans is to close a further 200 stores in the US, with thousands of jobs expected to be on the chopping block.
This follows the closure of 182 stores last month which saw 4500 jobs affected.
As yet it’s unclear whether this will mean additional store closures across the US or abroad.
However, here in the UK Toys R Us is facing a VAT debt payment deadline of £15 million in the coming days, which it will be unable to pay without a cash injection from an outside investor.
The potential US closures follow a filing for Chapter 11 bankruptcy protection late last year, which according to analysts actually hurt the retailer’s chances of recovery.
According to the editor of toy review website TTPM Jim Silver, this gave the impression that the company was shutting down before Christmas, deterring customers.
“There was too much consumer perception that they were not going to be around, and it hurt their traffic incredibly,” Silver said.
“When you are buying toys, you want to know you can return them and your gift cards will work.”