ToysR-Us
Consumer Products

Smyths to buy Toys “R” Us stores in Central Europe

The Irish toy retailer will pay nearly US$100 million to acquire and rebrand TRU's 93 stores in Germany, Austria and Switzerland.
April 23, 2018

Irish retailer Smyths Toys Superstores is set to acquire Toys “R” Us operations in Germany, Austria and Switzerland. The acquisition will be made on a cash-free and debt-free basis at an estimated aggregate purchase price of US$96.6 million.

Under the terms of the sale, which is subject to approval from the US Bankruptcy Court for the Eastern District of Virginia, Smyths Toys will rebrand the region’s 93 Toys “R” Us stores and four online shops under its own banner. TRU’s Central European business is forecasted to generate earnings of US$26.9 million in fiscal 2018, according to a company statement.

In addition, Toronto-based investment firm Fairfax Financial Holdings has officially placed a US$233-million bid for Toys “R” Us Canada ahead of an auction for the retailer’s Canadian assets. The auction will be held today at the offices of Kirkland & Ellis in New York, and Toys “R” Us expects to seek approval for the sale at a hearing scheduled with the Bankruptcy Court tomorrow. The agreement would also see Fairfax repay TRU’s outstanding indebtedness under the Superpriority Secured Debtor-in-Possession Credit Agreement on or before closing.

Previously, MGA Entertainment CEO Isaac Larian (along with affiliated investors) submitted a bid to buy the retailer’s 82 Canadian locations. The group reportedly also sought to operate as many as 400 US locations.

In March, Toys “R” Us announced it had begun the process of shuttering its US operations after filing for bankruptcy protection last September. Toys “R” Us Canada, however, was unaffected by the company’s US announcement as its 82 Canadian locations operate autonomously.

About The Author
Elizabeth Foster is Kidscreen's Copy Chief & Special Reports Editor. Contact Elizabeth at efoster@brunico.com

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