MGA Entertainment CEO Submits $890M Bid To Keep Toys R Us Stores Open
Isaac Larian, CEO of toy manufacturer MGA Entertainment, has offered $890M for the remaining Toys R Us and Babies R Us locations in the U.S. and Canada, CoStar reports.
The funds, split between a $675M bid for the U.S. stores and a $215M bid for those in Canada, would come from a combination of Larian's own assets, other investors and bank debt. Larian has set up a GoFundMe for individuals to assist in his bid, with a goal of $1B by Memorial Day.
Though Larian and his partners put up an initial $200M in the fundraiser, it has only raised an additional $62K from roughly 2,000 individual donations since it launched last month, each $1K or less. Larian came by the $890M bid based on his estimates for the fundraiser's success, according to CoStar, and if his bid is rejected, all donations to GoFundMe will be refunded.
Toys R Us plans to close 735 stores by June 30 as part of its bankruptcy proceedings, and all of those locations have been put up for auction. In the first round of bids, 157 Toys R Us and Babies R Us locations were made available, and the retailer accepted 50 bids. Forty-four of those bids were accepted by a bankruptcy judge and will likely be redeveloped or re-tenanted. The six remaining bids for Toys R Us leases were contested by the property owners, and a judge will make a decision on those come June 30.
For the remaining stores, Larian appears to be the only serious bidder with any designs on keeping the stores open. The head of MGA, which owns toy brands like Little Tikes, told CoStar he believes the toy industry would experience "long-term effects" should Toys R Us vanish from the map.
"The industry will truly suffer," Larian said.