The closure of Toys "R" Us after 70 years of dominating the US market leaves a void for toy lovers and makers alike.
Toys "R" Us Inc, the iconic toy retailer, is shuttering its 735 US stores after failing to find a buyer or reach a deal to restructure billions in debt, putting about 30,000 people out of jobs.
The closure is a blow to generations of consumers and hundreds of toy makers who sold their products at the chain's US stores, including Barbie maker Mattel Inc, board game company Hasbro Inc and other vendors like Lego.
"This is a profoundly sad day for us as well as the millions of kids and families who we have served for the past 70 years," Chief Executive Officer Dave Brandon said.
With shoppers flocking to Amazon.com Inc and children choosing electronic gadgets over toys, Toys "R" Us has struggled to boost sales and service debt following a $6.6 billion leveraged buyout by private equity firms in 2005.
Toys "R" Us said on Thursday it is seeking approval to liquidate inventory in its US stores, which debtors anticipate will close by the end of this year.
The company also said it is in discussions with some interested parties for a deal to combine up to 200 of its top performing US stores with its Canadian operations.
For its operations in Asia and Central Europe, including Germany, Austria and Switzerland, the company will pursue a reorganisation and a sale process. The already announced administration of its UK business will continue, the company said.
Wayne, New Jersey-based Toys "R" Us was already in the process of closing one-fifth of its stores as part of an attempt to emerge from one of the largest-ever bankruptcies by a speciality retailer.
Efforts collapsed this month after lenders decided, in the absence of a clear reorganisation plan, that they could recover more in a liquidation, closing stores and raising money from merchandise sales, sources with knowledge of the matter told Reuters.
The disappearance of Toys "R" Us leaves a void for hundreds of toy makers who relied on the chain as a top customer alongside Walmart Inc and Target Corp.
Shares of Mattel and Hasbro tumbled last week on Toys "R" Us' liquidation reports. Both rely on Toys "R" Us for roughly 10 percent of their revenues, according to their 2016 annual reports.