Several Bids of $1 Billion Offered for Asia Toys R Us Unit

Prospective buyers have submitted several bids in excess of $1 billion to Toys R Us for the bankrupt company’s majority stake in its Asia business, said a lawyer representing the company.

The company, based in the U.S. has operations around the world, but in September filed in the U.S. for bankruptcy protection amidst mounting debt and intense competition from retailers online.

Toys R Us locations across the U.S. as well as in other places such as the UK are being closed, while other operations in Europe and Asia remain open and thriving.

An attorney representing Toy R Us told a hearing at bankruptcy court on Wednesday that there are several bidders interested in acquiring a stake of 85% in the company’s Asian business.

He added that the company is nearing a deal to sell operations it has in Central Europe.

Prior to encountering problems in the U.S. as well as the UK, the toy store giant operated 1,600 stores in 38 countries.

In 2005, the business was acquired by a group of different investors that included KKR and Bain Capital two private equity businesses, which piled on debt in excess of $5 billion.

The company burdened with such debt with interest payments that at times were as high as $400 million per year.

Following a restructuring plan that failed and poor sales during the holiday shopping season in the U.S., it was announced by the company in March that it would shutter its U.S. and Puerto Rico stores.

It added that its operation in the UK would close as well after attempts at locating a buyer for 100 stores failed.

Traditional brick and mortar retailers in both the U.S. and the UK amongst other nations have faced mounting pressure because of the continued increase in shopping online by consumers.

Several attempts were made to sell off stores in the U.S. as well as the UK but have been called difficult with one UK administrator saying that any possible purchaser would have a difficult time gaining the right to the name Toys R Us, which the parent company in the U.S. owns, amongst other things. That is just one example of what has created complications when it relates to selling stores in the U.S. and UK.

Toys R Us is continuing its operations in over 700 stores located in Asia, including China, Japan and Singapore.

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