Updated! Toys“R”Us is in the home stretch.
The bankrupt playthings chain will begin closing its last remaining stores tomorrow and will shutter the final doors on Friday.
The retailer, which filed for Chapter 11 reorganization last year, began holding liquidation sales in April after attempts to find a buyer or restructure its $5 billion debt load proved futile.
The primary challenge for Toys“R”Us had been that killer of category killers Amazon, which, along with Walmart and Target, decimated the playthings specialty channel. Now the last toy chain standing, at least for this week, the company also went through a long series of restructurings, management changes and strategic pivots toward tech, which put it at 23rd place on TWICE’s Top 100 CE Retailers Report, with $441 million in electronics sales last year, a 14 percent decline.
But the final blow was a was a $6.6 billion debt-for-equity deal, structured by affiliates of Bain Capital, Kohlberg Kravis Roberts and Vornado Realty Trust, that took the company private in 2005. The chain never recovered.
The company’s beginnings date back 70 years, when a 25-year-old Charles Lazarus opened a Washington, D.C. children’s furniture shop to catch the post-war baby boom wave. A toy specialty store followed in 1957, and his category killer merchandising concept, along with the iconic Geoffrey the Giraffe mascot and catchy “I don’t wanna grow up, I’m a Toys‘R’Us kid” jingle, would eventually carry the chain around the world.
Lazarus died this past March, just as the company announced its impending liquidation.
If there’s one bright spot to the loss of a national chain and the tens of thousands of jobs that went with it, it’s that the 16-foot, 550-pound Geoffrey statue that welcomed guests to Toys“R”Us’s Wayne, N.J., headquarters was spared the glue factory. According to Bloomberg, liquidation attorneys helped find a good home for the fiberglass giraffe — at the Bristol-Myers Squibb Children’s Hospital in nearby New Brunswick — and donated the $16,000 to relocate him.
Plus there’s always the chance that somebody will win the brand in a forthcoming bankruptcy auction and give Toys“R”Us a new lease on life. Bloomberg says the smart money’s on former CEO and one-time Target vice chairman Jerry Storch, who is already lining up investors.
However, repeated attempts at reviving another iconic big-box national chain, Circuit City, have thus far proven fruitless.