Smyths Toys Superstores entered into a definitive agreement on April 21 to acquire Toys “R” Us operations in Germany, Austria, and Switzerland. Smyths Toys intends to rebrand the stores under its own banner.
The deal is for a headline enterprise value of €80 million (approx. $98 million U.S. dollars), on a cashfree and debt-free basis, and an estimated aggregate purchase price of €79 million (approx. $97 million U.S. dollars), of which up to €37 million (approx. $45 million U.S. dollars) may be escrowed at closing with release subject to certain conditions.
In fiscal year 2018, Toys “R” Us’ Central European business is forecasted to generate Adjusted EBITDA of €22 million (approx. $27 million U.S. dollars), after Information Technology and Administrative Support Service Agreement (ITASSA) expense of €5 million (approx. $6 million U.S. dollars) and royalties of €13 million(approx. $16 million U.S. dollars).
The sale of Toys “R” Us’ Central European business is subject to the approval of the United States Bankruptcy Court for the Eastern District of Virginia.
