Toys R Us May Be Liquidating its U.S. Operations

Shares of Hasbro and Mattel, two toy companies, saw some losses in after-hours trading on Thursday after it was revealed that Toys R Us may be liquidating its operations in the U.S. Sources told CNBC the news.

The Wall Street Journal has also said that liquidation is being seriously considered ahead of a bankruptcy hearing that the company has scheduled for Monday.

It was in February that Hasbro CEO Brian Goldner optimistically said, “Our retail footprint is bigger than ever before. We don’t see a long-term impact of from the Toys ‘R’ Us bankruptcy.”

It was last September that the company filed for bankruptcy, dealing with a whopping $4.9 billion in debt.

With the fourth quarter season hurting the company, as both traffic and profit was behind what the company told lenders it was expecting, some lenders have been pushing for liquidation.

Recently Toys R Us has also told workers at its going-out-of-business sales that it doesn’t have enough money to pay severance.

The company has already begun liquidation sales ahead of planned store closures.