They Need $1B to Save Toys R Us, Have $200M Already

Isaac Larian, the CEO behind Bratz Dolls, has an ambitious plan
By Newser Editors and Wire Services
Posted Mar 22, 2018 7:10 AM CDT
In this April 21, 2011 file photo shows MGA chief executive Isaac Larian, left, leaves federal court in Santa Ana, Calif., after a victory over Mattel Inc. The CEO of the maker of the pouty Bratz dolls...   (AP Photo/Christine Cotter, File)
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(Newser) – Toy company executive Isaac Larian says he and other unnamed investors have pledged a total of $200 million in financing and hope to raise four more times that amount in crowdfunding in order to bid for up to 400 of the Toys R Us stores being liquidated in bankruptcy. The unsolicited bid still faces many hurdles, including finding other deep-pocked investors and getting a bankruptcy judge to agree to it. But this is the first public plan to keep the cherished toy brand in existence in the United States. Such a long-shot move would also greatly benefit Larian's primary business. He's CEO of Bratz doll-maker MGA Entertainment, which relies on Toys R Us for nearly 1 in every 5 sales and is the world's largest privately held toy company. Larian, who is a billionaire, is using his own money, not MGA funds, for the bid.

He and the other investors are interested in more than half the 735 US stores Toys R Us plans to liquidate, and are hoping to secure pledges toward their $1 billion goal. Larian, who estimates that 130,000 US jobs could be lost when you include layoffs at suppliers and logistic operations, said a total Toys R Us liquidation could mean MGA would have to lay off workers at an Ohio plant that makes the Little Tikes toy vehicles. That brand accounts for 25% of MGA total sales, and Larian says only Toys R Us really has enough room to display the cars. Larian claims that if 400 US Toys R Us stores are salvaged, he could save one-third of the 130,000 jobs. Why might he be successful with a retail chain struggling to stay relevant in the age of Amazon? For one thing, Larian wouldn't have the massive $5 billion in debt that hampered the current owner of Toys R Us, notes the AP.


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