Toys “R” Us Inc. closed on $3.1 billion of financing facilities that will support the company’s operations during its previously announced financial restructuring process. These financings will support the ongoing liquidity needs of the company as well as provide additional funds to invest in various initiatives.
These investments include the renovation and modernization of Toys “R” Us stores through improved layouts, updated lighting patterns, and other areas to bring them into the next era of retail shopping. The investments will also include updating the company’s e-commerce sites and infrastructure to better reflect its brand, promote toys, and provide improved delivery capabilities for the retailer to  effectively compete in the online shopping space.
Various lenders contributed to the debtor-in-possession (“DIP”) financing, including a JPMorgan-led bank syndicate and certain of the company’s existing lenders. On September 20, 2017, the company received interim approval by the U.S. Bankruptcy Court to access up to $2.2 billion of the DIP financing. Toys “R” Us intends to seek final court approval to access the full amount of the DIP financing at a hearing that is scheduled for October 10, 2017.
In connection with the initiation of its financial restructuring proceedings, Toys “R” Us also has cancelled its Q2 2017 earnings conference call scheduled for September 26, 2017. Toys “R” Us intends, as soon as possible, to resume filing relevant materials with the Securities and Exchange Commission (SEC), including Forms 8-K, 10-Q, 10-K, and other relevant documents concerning the company’s financial performance.
As previously announced on September 18, 2017, Toys “R” Us and certain of its U.S. subsidiaries and its Canadian subsidiary voluntarily filed for relief under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the Eastern District of Virginia in Richmond, Virginia. In addition, the company’s Canadian subsidiary sought and was granted protection in parallel proceedings under the Companies’ Creditors Arrangement Act in the Ontario Superior Court of Justice. Toys “R” Us intends to use these court-supervised proceedings to restructure its outstanding debt and establish a sustainable capital structure that will enable it to invest in long-term growth.
