Ever since Toys “R” Us announced plans to shutter their U.S. stores, there has been endless speculation on what will happen to Toys “R” Us’ Canadian stores.
Ontario-based Fairfax Financial Holdings Ltd. has signed an agreement to buy the Canadian components of Toys “R” Us Inc. for approximately $300 million.
According to The Financial Post, the agreement big is called a “stalking horse” bid that allows other potential buyers to enter competing proposals. Fairfax holdings would then have the option of matching other organizaitosn bids or can decide to walk away from the deal completely.
The so-called stalking horse bid allows other potential buyers to enter competing proposals by Monday, the person said, asking not to be identified because the matter is private. Fairfax would then have the option of either increasing its offer or walking away. Under the terms of the deal, Fairfax would receive a break fee of about 4 per cent if another bidder is chosen, the person said.
According to insiders close to the agreement, Fairfax would be able to continue operating stores under the Toys “R” Us stores in Canada under the same name.
Earlier this week Toys “R” Us turned down an offer from MGA Entertainment…