Bratz CEO leads effort to salvage part of Toys R Us

Toy company executive Isaac Larian and other investors have pledged a total of $200 million and hope to raise four times that amount in crowdfunding in a bid to save potentially more than half of the 735 Toys R Us stores that will go dark in bankruptcy proceedings.

The unsolicited bid faces a number of hurdles like finding other deep-pocketed investors, as well as getting a bankruptcy judge to approve such an unusual plan. It is the first known plan to keep the Toys R Us brand alive.

The long-shot bid would be a huge benefit to Larian. Nearly 1 in every 5 sales made by Bratz doll-maker MGA Entertainment, where Larian is CEO, is rung up at a Toys R Us store.

Larian says he and the other investors, which he declined to name, believe that saving part of Toys R Us will be good for the toy industry, customers and workers.

The group now trying to save a remnant of the toy chain is hoping that with Toys R Us on the brink, it can reach its goal of raising $1 billion in funding. The website savetoysrus.com directs consumers to a GoFundMe campaign to do that.

Larian, a billionaire, is using his own money, not MGA funds, for the bid.

How could Larian save a store that has labored to remain relevant in the age of Amazon.com? For one thing, Larian would be free of the $5 billion in debt that hampered the current owner of Toys R Us. The other reason is self-preservation.

The demise of Toys R Us will have a “devastating effect” on the toy industry, said Larian, who believes that 130,000 U.S. jobs could be lost when layoffs at suppliers and logistic operations are included.

A total Toys R Us liquidation could mean layoffs at an MGA plant in Ohio that makes the Little Tikes toy vehicles. That brand accounts for 25 percent of MGA total sales.

“People do not realize the hole that can’t be filled by other retailers,” said Larian. “The pipeline is too big.”