Feb 16, 2018
Toys R Us tax bill threatens to derail rescue
The battle to save the UK business of Toys R Us has entered a critical stage, as executives battle to find a buyer in time to pay a tax bill that could tip the chain into administration. The American retailer's British arm, which employs more than 3,000 people, narrowly escaped collapse in December, when an industry-backed pension rescue fund threatened to block a sweeping restructuring plan aimed at taming an unmanageable rent bill. Lazard, the bank advising the retailer, and Toys R Us declined to comment. The retailer's US owner, which traces its origins to the post-second world war baby boom of the 1950s, was taken private in 2005 by a trio of private equity buyers comprising Bain Capital, KKR and Vornado Realty Trust. Established chains such as Toys R Us have been struggling to fight off online retailers that can offer wider selections and convenient delivery options, as well as limited-range discounters that wring operational efficiencies from their simpler stores.
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