Toys R Us employees in Derby can breathe an enormous sigh of relief this Christmas after the retailer was saved from collapse.
The retail giant has staved off administration after creditors backed a rescue plan for the company.
It follows last-minute negotiations with the Pension Protection Fund to secure a £9.8 million injection into the company’s pension fund.
The rescue plan entails closing 26 of its 105 UK outlets – but a list doesn’t include its two Derby stores, at Wyvern Retail Park and Intu Derby.
Store closures will instead happen in Aberdeen, Basingstoke, Belfast, Birmingham, Bolton, Bradford, Brislington, Cambridge, Cardiff, Derry City, Doncaster, Exeter, Hayes, Kirkcaldy, Leicester, Livingston, Manchester, Plymouth, Scunthorpe, Shrewsbury, Tamworth, Tunbridge Wells, Watford and York.
Bosses say no stores will close before spring 2018.
Toys R Us at the Wyvern in Derby
Toys R Us’s UK staff pension scheme has a deficit of more than £25 million.
The PPF said the new offer from the company was composed of £3.8 million in 2018, with a further £6 million promised over 2019 and 2020.
The retailer’s creditors met on Thursday to vote on the rescue plan, which hinged on a resolution of the pension deficit.
Toys R Us will continue to trade under its company voluntary arrangement (CVA), which is a step short of going into administration.
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Steve Knights, the UK managing director of Toys R Us UK, said: “We are pleased to have secured the support of our creditors and will be working closely with them in the months ahead.
“The vote in favour of the CVA represents strong support for our business plan and provides us with the platform we need to transform our business so that we can better serve our customers today and long into the future.”
“All of our stores across the UK will remain open for business as normal until spring 2018.”
The company sells largely from warehouse-style stores at the edge of towns but says these are now “too big and expensive to run”. It does have some smaller stores, such as the one in the Intu Derby shopping centre. It is also finding it hard to compete against online toy retailers.
Source: Derby Telegraph