The top lenders of Toys ‘R’ Us have decided to cancel the bankruptcy auction of its brand name and other intellectual property assets and instead plan to revive the Toys ‘R’ Us and Babies ‘R’ Us brand names, a court filing on Monday showed.
Toys “R” Us had filed for Chapter 11 bankruptcy protection in September 2017, hoping to restructure some $5 billion in debt, much of which stemmed from a $6.6 billion leveraged buyout by private equity firms in 2005. Chapter 11 of the Bankruptcy Code generally provides for reorganization, usually involving a corporation or partnership. A Chapter 11 debtor, Toys “R” Us in this case, usually proposes a plan of reorganization to keep its business alive and pay creditors over time. People in business or individuals can also seek relief in Chapter 11.
The bankrupt retailer’s debtors aim to open a new Toys ‘R’ Us and Babies ‘R’ Us branding company that maintains existing global license agreements and can invest and develop new retail shops.
But the company changed course in March, saying it would sell its operations in Canada, Asia and Europe, and shut down in the United States.
Under the intellectual property auction, the company had planned to sell its assets, including the brand names of Toys ‘R’ Us, Babies ‘R’ Us, registry lists, website domains, Geoffrey the Giraffe and other assets.
Article credit goes to Reuters which can be read here.