Toys R Us Acquires Retail Giant
In an effort to boost its revenue and expand its market, Toys R Us Inc. has acquired retail store chain FAO Schwarz on Wednesday.
Meanwhile, this acquisition is important for the two toy companies to survive steep competition with other online toy stores and discounted retailers and cushion the impact of recession.
Toymaker giant Toys R Us Inc. has acquired retail store chain FAO Schwarz on Wednesday in an effort to expand its market, target young consumers, and ultimately boost its revenue.
In a statement, Toy R Us CEO Jerry Storch said the takeover bid will allow the company to have a competitive edge in the market as retail giants such as Wal-Mart is continuously posting threat to toymaker industry by providing cheaper and discounted toys.
Storch also said that the takeover bid will allow them to make innovative toys and follow the latest trends in the market to provide satisfying products to young children who are the main-target market of the company.
When asked for how much the company acquired FAO Schwarz, which was facing imminent bankruptcy, Toy R Us did not provide details. However, analysts predicted that the price may come as “very cheap” since FAO Schwarz has no option but to allow itself to be consumed by bigger company to avoid financial meltdown.
To allay some concerns, Storch said that they are planning to retain some FAO Schwarz store employees and said they are still discussing plans on how to restructure its new business platform.
Toy retailers blamed its slumping sales with the growing popularity of online retailers as more consumers are turning into web-centric users.
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