Toys R Us could go bust as soon as tomorrow

TOYS R Us could plunge into administration tomorrow after talks with potential buyers broke down.

The toy chain’s UK arm – which employs 3,000 people at 105 stores – is desperately scrambling to find the cash for a £15million VAT bill due tomorrow.

Recovery firm Moorfields is understood to be on standby to handle the administration process.

And the Pension Protection Fund has been warned that the firm’s 600-member retirement scheme is likely to fall into their hands, meaning substantial cuts to savers’ benefits.

Insiders believe the situation is bleak after potential buyers Hilco Capital, known for saving music chain HMV in 2013, and Alteri Investors pulled out of talks due to the complexity of the turnaround job needed.

It comes just two months after the stricken toy retailer won a stay of execution thanks to a restructuring deal which saw it pledge to shut a quarter of its shops and slash its rent bill.

Potential buyers are said to have been told they must lodge a bid by the end of today. The firm declined to comment.