Retailer Toys R Us has collapsed into administration, putting 3,200 jobs at risk, after last-ditch rescue attempts failed.
READ MORE: Toys R Us to close four Scottish stores
Administrator Moorfields Advisory has started an “orderly wind-down” of the company’s stores after the embattled firm failed to find a last-minute buyer to save the business.
Toys R Us is one of the nation’s biggest toy retailers, with more than 100 stores in the UK and 1,500 in 33 countries across the globe.
The firm was grappling with a £15 million tax bill as well as money owed to lenders.
Toys R Us has struggled with cashflow pressures after sales were squeezed by worse-than-expected trading over the crucial Christmas period.
In addition, falling consumer spending, soaring inflation and competition from online rivals have dented performance in recent years.
Simon Thomas, Moorfields partner and joint administrator, said: “We will be conducting an orderly wind-down of the store portfolio over the coming weeks.
“All stores remain open until further notice and stock will be subject to clearance and special promotions. We’re encouraging customers to redeem their gift cards and vouchers as soon as possible.
“We will make every effort to secure a buyer for all or part of the business.”
Toys R US announced a Company Voluntary Arrangement (CVA) at the end of last year in an attempt to shore up its financial position by allowing it to shut loss-making stores and secure deep discounts on rental costs.
The restructuring plan won the approval of 98 per cent of creditors in December, and had the backing of the Pension Protection Fund (PPF). Its pension fund is set to be taken over by the PPF.
Efforts to find a buyer fell flat and the firm was forced to call in the administrators.
Electronics company Maplin also collapsed into administration yesterday, putting another 2,500 jobs at risk.
The group, owned by private equity firm Rutland Partners, called in PwC after attempts to rescue the chain failed.
Maplin has 217 stores in the UK, and PwC is still attempting to find a buyer for the group.
Graham Harris, the company’s chief executive, said: “During this process Maplin will continue to trade and remains open for business.”
He said the retailer has been struggling to mitigate the impact of the pound’s devaluation post the Brexit vote, a weak consumer environment and the withdrawal of credit insurance.
Edinburgh Woollen Mill, run by retail billionaire Philip Day, had been touted as a potential rescuer for Maplin. But talks are thought to have broken down, leaving Rutland no alternative but to call in administrators.