Troubling times for Toys ‘r’ Us and its staff as Toyworld Mag bring news of the Toys ‘R’ Us UK CVA explained (company voluntary arrangement) that will see almost 30 UK stores close.
Toy World has picked through all the information from the past 24 hours of reporting to bring you the key facts and figures, including which stores will be closed. The CVA proposal was made available to creditors yesterday. The creditors will vote on the proposal on 21st December. A vote of 75% is required for the CVA to progress to the next level.
Toys R Us has stressed that its UK stores will remain open through Christmas and well into the New Year, and that all customer returns, gift cards and loyalty programmes will be unaffected by the process.
However, a minimum of 26 UK stores will ultimately be closed, but it may end up being more. The closures are likely to take place in the late spring or early summer 2018. In addition, as a result of the CVA, other stores may be downsized or rents subjected to significant readjustments.
According to Toys R Us, the CVA plan is an entirely separate process to the Chapter 11 proceedings in the US, and is not a consequence of the US operation’s ongoing difficulties. However, both the UK and US businesses acknowledge that they are facing “challenging conditions” in their domestic markets.
Is the CVA likely to be approved? Broadly speaking, landlords have been offered 80p in the £1 via the CVA proposal. The alternative to the CVA is potentially administration, which would see landlords receive approximately 12.5p in the £1. As a result, it is thought likely that the CVA will be approved.
The stores signposted for closure include:
Aberdeen
Basingstoke
Belfast Newtonabbey
Birmingham St Andrews
Bolton
Bradford
Brislington
Cambridge
Cardiff
Derry City
Doncaster
East Kilbride
Exeter
Hayes
Kirkcaldy
Leicester
Livingston
Old Kent Road
Plymouth
Scunthorpe
Shrewsbury
Tamworth
Tunbridge Wells
Watford
York
Manchester Central Retail Park (earmarked for closure prior to CVA decision)
