In a move that primes the company for further expansion in the region, mega retailer Toys ‘R’ Us has taken a majority stake in Li & Fung’s existing retail operations of TRU stores throughout Southeast Asia and Greater China. Effective immediately, Toys ‘R’ Us will wholly own 90 existing stores in the region.
Under the deal, existing Toys ‘R’ Us licensed operations throughout Asia, which currently total more than 100 stores and offices across nine markets, will become 70% majority owned and controlled by Toys ‘R’ Us and 30% owned by Li & Fung. The terms of the joint venture also keep the door open for Toys ‘R’ Us to acquire the remaining share of the business in the future.
The 90 stores that will be wholly owned by Toys ‘R’ Us are located across Brunei, China, Hong Kong, Malaysia, Singapore, Taiwan and Thailand. The remaining 14 stores in the Philippines and Macau continue to be operated under the license agreement.
The joint-venture will also include ownership and oversight of office operations in seven markets, as well as the regional headquarters in Hong Kong.
With the agreement, Toys ‘R’ Us now operates more than 600 wholly owned locations in the UK, Japan, France, Germany, Spain, China and Canada, among others. The company currently has more than 140 licensed stores through agreements with retail partners like Li & Fung.
With the joint venture, both companies have outlined plans for an aggressive expansion in both existing and new Asian markets, particularly Northern China.