By Dhanya Skariachan and Sagarika Jaisinghani
March 29 Toys R Us Inc withdrew its
proposed initial public offering on Friday, ending months of
uncertainty as the world's largest dedicated toy retailer also
issued a quarterly report card showing disappointing results for
the crucial holiday season.
Toys R Us determined not to pursue the IPO due to
unfavorable market conditions and executive leadership
transition, Toys R Us spokeswoman Kathleen Waugh told Reuters.
Waugh did not give an update on the company's search for a
new CEO. In February, Gerald Storch decided to step down as Toys
R Us chief executive, but he remains chairman of the board.
The withdrawal of the IPO would not affect the toy
retailer's day-to-day operations, Waugh said, but declined any
The resignation of Storch, 56, added to doubts about the
retailer's chances to return to being a public company this
year, after filing for an initial public offering in May 2010.
KKR & Co LP, Bain Capital and Vornado Realty Trust
took Toys R Us private in 2005, in a $6.6 billion deal.
While the company's results were far better when it was
originally considering the IPO, some owners thought they would
be able to raise more if they waited, a source had told Reuters.
But the results have lagged expectations since then.
The company had postponed its IPO in 2011 due to weak market
conditions and has since struggled with mounting interest
expenses and weak sales. Sources had told Reuters in February
that chances of this IPO happening were low.
Toys R Us, which operates stores under its namesake brand
and the Babies R Us and FAO Schwarz names, said total sales fell
3 percent in the fourth quarter to $5.77 billion while interest
expense jumped 35 percent in the 14 weeks ended Feb. 2. Net
profit fell 30 percent to $240 million.
The company's performance in 2012 was hurt by a weak global
economic environment, particularly in Europe and Japan, Storch
said in a statement.
Toys R Us first went public in April 1978 and operated as a
public company until July 2005, when it was taken private.