TORONTO — Two months after putting itself up for sale to help pay off its significant debt, Toys “R” Us Canada has reached several agreements to sell various assets, including its name, trademarks, inventory, and leases to three different buyers—one of whom is its current owner. Court records indicate that the retailer, which has been under creditor protection since February, is looking to sell the rights to the Toys “R” Us Canada and Babies “R” Us Canada names to a U.S.-based firm called Ad Populum.
Ad Populum is set to acquire approximately 150 of the brand's trademarks, which include rights to its iconic Geoffrey the Giraffe mascot, as well as numerous website domains and social media accounts associated with the brands. This company is known for managing several toy brands and includes operations related to Graceland, the Elvis Presley attraction in Tennessee.
Additionally, a numbered company owned by Doug Putman, Toys “R” Us Canada’s current owner, has been granted the opportunity to purchase 10 store leases along with the brand’s remaining inventory, equipment, logistics contracts, and bank accounts. In another deal, Fox Group Jumbo Canada, an Israel-based company, has proposed acquiring the lease for a 48,000-square-foot store located at Vaughan Mills, a mall north of Toronto.
The court documents, however, do not provide a value for any of the transactions. All the deals must receive court approval due to Toys “R” Us Canada entering creditor protection earlier in the year owing more than $160 million to unsecured creditors. The company plans to seek this approval on June 22.
In the lead-up to its filing for creditor protection in February, the retailer shut down 53 stores across Canada in just two years and endured at least a dozen lawsuits from suppliers and landlords owed money. Following its entry into creditor protection, many of these lawsuits were placed on hold, but the company continued to close stores, reducing its locations to just 18 in April.
On the latest updates shared in court documents, Toys “R” Us Canada announced the closure of an additional three stores located at Midtown Plaza in Saskatoon, St-Bruno in Quebec, and Kingston in Ontario. This decision has reduced the workforce from 562 employees to just 260.
In an attempt to recuperate funds owed to creditors and ensure its survival, Toys “R” Us Canada listed itself for sale in the spring of April. Offers to buy the company or invest in its ongoing operations were accepted in May. The company has not detailed what its total assets include, but court records cite a valuation of $126.8 million.
As part of the sales process, Toys “R” Us Canada approached 90 companies, of which 11 submitted non-binding letters of intent to make offers. Ultimately, the process was narrowed down to two bids for all of its assets, two for its intellectual property only, and one for a single unspecified lease. The successful deals with Ad Populum and Jumbo are expected to finalize by July.
Doug Putman has not disclosed his plans for the assets he aims to acquire, and a precise timeline for the closing of his deal remains unspecified. His legal team did not respond to inquiries for comments. Putman, who owns Toys “R” Us Canada through a numbered corporation based in Ancaster, Ontario, also has ownership stakes in businesses such as HMV, Sunrise Records, Northern Reflections, Ricki’s, and Cleo. He had previously launched a chain of home goods stores, Rooms + Spaces, and also took over T. Kettle's tea shops; both brands have since closed all their locations.
Putman has owned Toys “R” Us Canada since 2021, after purchasing the retailer from Fairfax Financial, which had previously invested $300 million to rescue the company and its Babies “R” Us branch in 2018 after the American counterpart filed for bankruptcy. The current financial struggles of Toys “R” Us Canada highlight the challenges faced by aging retail brands navigating an evolving market and significant debt burdens.
