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Toys “R” Us wants to build one of the largest toy and baby stores in Australia as part of expansion plans that also include launching pop-up shops in well-known department stores around the world.
The children’s retailer collapsed in 2018, but the brand was rescued in Australia and bought by ASX-listed toy retailer Funtastic, which changed its name to Toy “R” Us ANZ in 2021.
On Monday, the company launched an $8 million capital raising in hopes of generating cash for new growth plans including opening a 3000-square-metre retail hub at its Melbourne headquarters in Clayton.
Toys “R” Us has launched an $8 million capital raising.Credit: Shutterstock
Toys “R” Us chairman Kevin Moore said the new site, which is attached to the group’s state-of-the-art logistics centre, would be modelled on the US flagship Toys “R” Us store that opened in the American Dream Mall in New Jersey in 2021.
“When that store went in, it highlighted the fact that Toys “R” Us as a store [still] had a place in retail,” he said.
Toys R Us chairman Kevin Moore.
The custom-designed store at Clayton would include the Toys “R” Us and Babies “R” Us retail brands. It would also include a cafe, have activities for children and give the public the chance to watch the company’s robot-driven warehouse in action.
“It will be a hands-on [store] for kids to play with things and discover things,” Moore said.
The group told investors that if it hit its target of raising $8 million, it would put $3 million towards the opening of the new retail site. The company plans to raise the funds by offering existing shareholders a chance to buy new shares at 11¢ each, a 20 per cent discount to where the stock closed on Friday.
Toys “R” Us also has other expansion plans in the works, including increasing its network of pop-up shops within existing retailers around the world.
The brand entered Macy’s department stores as part of a trial in the middle of 2022 and has now rolled out 450 Toys “R” Us “stores” within stores in the Macy’s network.
It wants to spend another $3 million to support the rollout of new pop up shops in the United Kingdom, after the launch of nine trial stores in WH Smith High Street shops.
Moore said the Toys “R” Us brand was trusted and helped bring shoppers into department stores, noting that the company was open to similar partnerships in Australia.
“We’re always open-minded … There are many retailers in Australia who would love to have increased footfall into their stores,” he said.
Retail executive Penny Cox, who has held roles at Coles, Ocado and Alibaba, will relocate from Singapore in August to take up the chief executive role at the company after outgoing boss Louis Mittoni resigned in May.
The company’s shares edged lower on Monday to sit at the 11¢ entitlement offer price.
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