Toys"R"Us Japan applied for civil rehabilitation proceedings, with total liabilities of approximately ¥13.2 billion. PPIH, which operates Don Quijote, is reportedly negotiating to take over all 158 stores.
Toys"R"Us Japan, which operates a toy retail business, applied to the Tokyo District Court for the commencement of civil rehabilitation proceedings. In its latest results, revenue was approximately ¥75.2 billion, marking the 8th consecutive fiscal year of net losses, while total liabilities were disclosed at approximately ¥13.2 billion.
The company expanded its store network nationwide after opening its first Japanese store in 1991, and at one point revenue reached approximately ¥194.3 billion in fiscal 2007. It is now negotiating to transfer the business to PPIH, with the plan for all 158 stores to be taken over.
PPIH plans to take over the entire Toys"R"Us Japan store network while retaining the brand name for the time being. Although toy demand remains at a certain level in the Japanese market amid a declining birthrate and an ageing population, the focus is on why the company reached the point of filing for civil rehabilitation.
Attention will turn to the operating structure after the transfer, progress in store integration and changes in the competitive environment. The case will be watched for how it may contribute to broader industry restructuring, in comparison with developments in the retail industry such as Seiyu.