Toys R Us stores to be shut down
TOYS R Us and Babies R Us stores across Australia will be shut down, putting 700 people out of work, after administrators failed to find a buyer for the failed business.
The chain of 44 toys and baby goods stores has been trading since entering voluntary administration in May but on Wednesday administrators McGrathNicol said all potential buyers had pulled out and the business will be wound down.
McGrathNicol said stock will now be liquidated through sales at existing stores before they, along with the head office and Sydney-based distribution centre close "in coming weeks".
Toys R Us's online ordering system will be closed on Friday, June 22, with the administrators saying open online orders will be delivered to customers in cases where they have paid in full and stock is available.
McGrathNicol told Toys R Us employees about the impending closure on Wednesday.
It is expected workers will receive all their entitlements from the proceeds of the liquidation and asset sales.
People holding gift cards for the stores will be able to use them until July 5, provided they spend an additional amount equal to the value of the card, the administrators said.
Lay-bys will also be honoured until July 5.
The collapse of the Australian stores follows the failure of the US Toys R Us business in March.
The group's 885 US stores were slated for closure after it was unable to meet the payments on billions of dollars in debt accumulated since it was bought by a real estate investor and two private equity firms in 2005.