Toys R Us Asia; New Owners and Robust Expansion Plans

6a0133ec87bd6d970b01bb08fe52c6970d 111Here is some good news. Toys R Us Asia has finalized its new ownership. According to the Nikkei Asian Review, 79% of the new ownership will consist of Toys R Us senior secured note holders (Taj, LLC) and 21% by Li & Fung. Under the prior ownership agreement, Toys R Us controlled 85% of the shares while Li & Fung owned the other 15%.

The article quotes Toys R Us Asia's CEO, Andre Javes, as saying: "…The priority for the company now is to expand its chain in Asia. This includes plans to add 68 stores in its existing Asian markets in 2019, with most of the new openings targeted for China and Japan."

Under the agreement, Toys R Us Asia is valued at $900 million US with 450 stores currently operating Hong Kong, Taiwan, Japan, China, Brunei, Thailand, Malaysia, Singapore and the Philippines. 

Li & Fung, with its powerful sourcing engine, is a great partner for Taj, LLC. The Asian stores have always performed well and with this new ownership seem positioned to dramatically scale up in that part of the world.

The survival of the Asian stores plus the plans to expand make Toys R Us Asia an attractive customer for toy companies looking for a way into China while expanding their revenues globally. 

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