Toys R Us Asia businesses consolidated
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Toys R Us is unifying its Japanese business with its ventures in Greater China and Southeast Asia.
Under a new JV agreement with Hong Kong-based Fung Retailing, Toys R Us Japan, which has 160 stores, will be consolidated into Toys R Us Asia.
The merged business will now be roughly 85 per cent owned by Toys R Us, with the balance held by Fung Retailing. The two companies have been working together since 1985. Toys R Us Asia and its subsidiaries have 223 stores in Brunei, China, Hong Kong, Malaysia, Singapore, Taiwan and Thailand. Toys R Us Asia also licenses 34 retail locations in Macau and the Philippines.
The combined company’s headquarters will be in Hong Kong, while a regional office will continue working in Kawasaki, Japan. The retailer says the consolidation will allow the company to streamline, as well as accelerate innovation.
Toys R Us Asia Pacific president Andre Javes will continue to have oversight of the combined businesses, as well as Toys R Us Australia.
International same-store sales for Toys R Us grew 1.2 per cent in the second quarter of last year, driven by strength in the Asia-Pacific market. However, international sales eased 2.5 per cent in the third quarter.
Questions & Answers
Q.What will be the ownership structure of the newly consolidated Toys R Us Asia business?
What will be the ownership structure of the newly consolidated Toys R Us Asia business?
Toys R Us will own approximately 85% of the merged business. The remaining share will be held by Fung Retailing. This new structure results from a joint venture agreement between the two companies.
Q.How many retail locations will the combined Toys R Us Asia entity operate and license?
How many retail locations will the combined Toys R Us Asia entity operate and license?
The consolidated business will operate 223 stores across several Asian territories, including Brunei, China, and Malaysia. Additionally, it will license 34 retail locations in Macau and the Philippines, significantly expanding its reach.
Q.What is the primary reason given for unifying the Japanese business with other Asian ventures?
What is the primary reason given for unifying the Japanese business with other Asian ventures?
The retailer stated that the consolidation aims to streamline operations across its Asian businesses. It also expects the move to accelerate innovation within the combined company, enhancing its market position.
Q.What was the recent performance trend for Toys R Us's international sales?
What was the recent performance trend for Toys R Us's international sales?
International same-store sales grew by 1.2% in the second quarter of last year, boosted by the Asia-Pacific market. However, this positive trend reversed in the third quarter, with international sales easing by 2.5%.
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