The LEGO Group is among suppliers scrutinising the liquidation plans of Toys R Us in the USA.
Ailing retailer Toys R Us told a bankruptcy hearing that it is working to pay as much as possible to suppliers and lenders. Over 50 suppliers, including the LEGO Group, have raised objections to the liquidation proceedings, Reuters reports.
As more than 700 Toys R Us stores in the US prepare to close their doors for good, companies are demanding that the retailer return unsold stock rather than clear out the inventory for low prices. The LEGO Group is understood to be looking for its product to be returned rather than sold off. Companies are concerned that while they are not being paid for stock, it is likely to be sold off at bargain prices to pay secured lenders and bankruptcy lawyers.
“We’re making every effort to make sure (trade vendors) will be paid in full,” Lazard’s David Kurtz, who is advising Toys R Us, told the U.S. Bankruptcy Court in Richmond, Virginia. Aside from the already resolved UK firm, Toys R Us is seeking a deadline of March 26 to sell off its foreign businesses. An issue of concern to the toy industry is the retailer’s request to essentially write off $450 million in supplier payments, that could push small manufacturers and suppliers into bankruptcy.