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Possible bankruptcy for Toys R Us

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Toys R Us, the nation’s largest retailer of toys and games, could file for bankruptcy this week. Sources within the company said that bankruptcy plans are not definite and both the plans to file and the timing of the announcement could change.

Toys R Us in 2005 was acquired by the private equity firms KKR and Bain, and real estate investment trust Vornado in a deal valued at $6.6 billion. The proposed debt restructuring could help the retailer with needed financial flexibility to invest in its business as it is reportedly repositioning itself to combat the changing retail landscape brought on primarily by on-line shopping.

Toys R Us anticipates a $400-million shortfall next year.

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