Toys “R” Us outlined in court documents its plan close as many as 182 stores as part of its bankruptcy reorganization.
The company noted that some closings may be avoided if it is able to negotiate more favorable lease terms. But most of the stores listed in the documents are expected to close as Toys “R” Us tries to reinvent itself as a leaner retailer.
Going-out-of-business sales are scheduled to begin in February and be completed in April.
Toys “R” Us will shrink its store count by about 20 percent if all 182 stores are closed.
Only two Iowa stores will be closed, both in the Des Moines area.
In addition to closing stores, the company intends to convert a number of locations into combined Toys “R” Us and Babies “R” Us stores.
On Tuesday, Toys “R” Us won U.S. Bankruptcy Court approval of a plan to pay landlords up to $1.3 million to extend store leases beyond an April 16 deadline.
Attorneys for Toys “R” Us argued before U.S. Bankruptcy Judge Keith L. Phillips in Richmond, Va., that it needed more time to decide which of its 880 U.S. stores to close as the company reorganizes.
The retailers previously won court approval to extend to July 15 its deadline for filing a Chapter 11 reorganization plan.
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Toys “R” Us is holding going-out-of-business sales at 25 stores in the United Kingdom. The U.K. arm of Toys “R” Us also is undergoing a restructuring.
When Toys “R” Us filed for Chapter 11 protection Sept. 19, it faced a 120-day deadline for rejecting store leases. But the company argued that because of the timing of the bankruptcy filing, it needed to focus on the holiday season — its most critical sales period — before deciding the fate of its stores.
In December it won a ruling to extend the lease rejection deadline to April 16.
The decision Tuesday gives Toys “R” Us the option to extend that deadline further, with the consent of landlords. The $1.3 million would be used to pay consenting landlords for attorneys’ fees and rent claims.