Toy store chain could close some stores, obtains creditor protection

Mastermind Toys says it has obtained an initial order for creditor protection from the Ontario Superior Court of Justice as it continues to cope with financial challenges and a slowing economy.

The independent specialty toy and children’s book retailer says all 66 of its stores across Canada remain open for business and all ongoing sales and holiday promotions, including its Black Friday sale, will continue.

But Mastermind Toys says it plans to seek court authorization to close an unspecified number of stores during the proceedings under the Companies’ Creditors Arrangement Act.

It will also explore strategic alternatives for the remainder of the company’s stores and expects to seek additional relief at a court hearing next Thursday.

The company says its decision to seek creditor protection was difficult but necessary after recent challenges such as increasing competition and disruptions from the COVID-19 pandemic, which have become too significant to overcome.

Alvarez & Marsal Canada Inc. has been appointed as the CCAA monitor.

The Canadian Press