Toys ‘R’ Us settles with ‘some’ creditors
Now that the dust has settled on its liquidation sales, Toys “R” Us has entered into a plan to pay off some its creditors, including vendors.
Toys “R” Us has struck a deal with certain debtors and their key stakeholders to resolve disputes and maximize stakeholders’ recoveries. The new plan also avoids what could become a “lengthy, complex, and expensive litigation,” according to documents filed in bankruptcy court this week.
According to the filing, an account will park funds for claims, including a baseline recovery of $180 million for participating creditors, as well as shared recovery after a group of secured lenders receive at least 50% of the $1 billion aggregated funds they were owed according to pre-bankruptcy filings. Creditors have the choice to opt out of the deal.
Former Toys R Us workers could be next on the retailer’s list of payouts. Former employees are talking to two buyout firms about a possible hardship fund, according to CNBC.
KKR and Bain, which took the company private in partnership with Vornado Realty Trust in 2005, are considering providing some financial help for workers who were hardest hit by the toy chain’s bankruptcy and liquidation. Vornado has not answered their emails, according to the report.
Toys “R” Us filed for bankruptcy in September, struggling under a heavy debt load and several years of lackluster sales due to increased competition from online competitors and discounters. Despite efforts to restructure its business, on March 15, Toys “R” Us informed a U.S. bankruptcy court that that it would close its U.S. stores.
Following a liquidation sale, the toy retailer finally closed its doors on Friday, June 29.
eBay lowers full-year guidance
Less engaging marketing initiatives took their toll on eBay for the second quarter, an issue that pushed the company to lower its full-year guidance.
For the quarter ended June 30, revenue was $2.6 billion, a 9% year-over-year increase. In addition to being at the lower end of its guided range of $2.64 billion-$2.68 billion, revenue also missed analyst estimates of $2.66 billion. Net income was $638 million.
In the second quarter, eBay grew active buyers by 4% across its platforms, for a total of 175 million global active buyers.
During the second quarter, the company also announced its intent to sell its holdings in Flipkart, which will represent gross proceeds of approximately $1.1 billion. The company plans to relaunch eBay India with a differentiated offer to focus initially on the cross-border trade opportunity.
The company also completed its acquisition of Giosis’ Japan business, including the Qoo10.jp platform, which expands its footprint in Japan.
eBay also lowered its full-year revenue guidance to between $10.75 billion and $10.85 billion.
eBay’s president and CEO Devin Wenig explained that the company will also revamp its marketing strategy, due to projects that underperformed. “We have experimented with all kinds of new mediums of human to computer interface,” he said during the company’s earnings call on July 18.
“It’s very healthy for us to constantly experiment and have a portfolio of projects that are both near and far, and on some of the far ones we are continuing and some we are not,” Wenig added. “Some key initiatives may not deliver GMV acceleration until later in the year. While the first half of 2018 has brought some unanticipated challenges, we expect core acceleration in the second half while delivering very strong earnings growth.”
Meal-kit company reportedly shuts down
The kitchen is closed at Chef’d.
The meal-kit company suddenly shut down its services on Monday, July 16. By Tuesday, the company’s website stopped accepting customers’ orders, according to Business Insider.
Founder and CEO Kyle Ransford sent an email to more than 350 employees on Monday evening saying, “We have had some unexpected circumstances with the funding for the business. Due to setbacks with financing, unfortunately, we are ceasing operations for all employees, effective today, July 16, 2018.”
The news comes on the heels of the company’s recent partnership with Walgreens, a deal that entitled Chef’d to sell its boxed meal kits at 30 Walgreens and Duane Reade locations in the New York area.
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