Toys 'R' Us files for bankruptcy protection

The move to file for bankruptcy protection cast doubt over the future of Toys 'R' Us's 1,600 stores and 64,000 employees. It came just as the company was gearing up for the holiday season, accounting for the bulk of its sales.

"While today's decision does not necessarily mean it is game over for the firm, it brings to a close a turbulent chapter in the iconic company's history," GlobalData Retail Managing Director Neil Saunders said in a statement.

"Together with our investors, our objective is to work with our debtholders and other creditors to restructure the $5 billion [4.2 billion euros] of long-term debt on our balance sheet," Toys 'R' Us said.

The company added that its Canadian unit intended to seek protection in parallel proceedings under the Creditors Arrangement Act in the Ontario Superior Court of Justice.

Keep hoping

Operations outside the US and Canada, including over 250 licensed stores and joint venture partnerships in Asia, are not part of the bankruptcy proceedings.

"What they have going for them is they are the last major player in their market," said BDO Consulting restructuring specialist David Berliner.

"The vendors don't want to see them fail, so I think they have a good opportunity to survive."

hg/jd (Reuters, dpa)