Toys R Us has been struggling to stay afloat for the last few years and it just announced that it will either sell or close all of its stores throughout the United States. The company announced its decision to liquidate on March 15, after nearly 70 years in business. The company did not actually file for Chapter 11 bankruptcy until March 20. The company owed millions of dollars two several borrowers, including:
- $129.7 million to Guggenheim Partners
- $107.9 million to J.P. Morgan Chase
- $107.8 million to H/2 Capital Partners
Of course, this isn’t all of the debt that Toys R Us owes. The company owed $859 million to creditors against owned properties and about $5 billion in total in other outstanding payments. The company will be closing about 700 stores throughout the United States. Toys R Us will be able to continue sales via their online store and bring in money during the bankruptcy.
What is a Chapter 11 bankruptcy and how can it help a business?
A Chapter 11 bankruptcy allows a business to keep their company open and continue operations but re-organize finances in an effort to repay creditors over the course of 5 years. Businesses that file for Chapter 11 bankruptcy will be able to reap the benefits of the automatic stay and take the necessary time to fix financial problems to have a successful future.
If you need to discuss financial matters for your business or the potential for bankruptcy, contact our firm today.
If you require the services of an experienced Business Law or Bankruptcy attorney, contact the Law Offices of Allen A. Kolber, Esq. today to schedule a consultation and discuss your options.
