Toys ‘R’ Us move won’t affect SA firm

AMIC Trading, the licence holder for Toys ‘R’ Us Southern Africa, says it will be unaffected by the bankruptcy declaration by Toys ‘R’ Us in the US and Canada and expects to open seven stores in the next three months.

Toys ‘R’Us Southern Africa was a privately owned independent company operating under a licence agreement and functioned independently from Toys ‘R’ Us global affiliates, Amic Trading said on Tuesday.

The opening of new stores highlighted the growth and stability of the company locally, the company said in a statement.

Toys ‘R’ Us Southern Africa has 53 locations. Toys ‘R’ Us, the largest US toy store chain, filed for bankruptcy protection on Monday, with chief executive Dave Brandon saying this would allow it to restructure $5-billion (R66.2-billion) of long-term debt on the company’s balance sheet.

The US company had received a commitment for over $3-billion (R39.7-billion) in debtor-in-possession financing from various lenders including a JPMorgan-led bank syndicate and certain of the company’s existing lenders.

Should this receive court approval, it was expected to immediately improve the company’s financial health and support its operations during the court-supervised process, the company said.

“The company intends to use these court-supervised proceedings to restructure its outstanding debt and establish a sustainable capital structure that will enable it to invest in long-term growth and fuel its aspirations to bring play to kids everywhere and be a best friend to parents,” Toys ‘R’ Us explained.

The company owns 1 600 stores around the world, the majority of which are profitable. — DDC