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Toys "R" Us Canada granted creditor protection after U.S. parent begins bankruptcy proceedings

Last Updated Sep 20, 2017 at 10:19 am PDT

A Toys "R" Us store is seen in Montreal on Tuesday, September 19, 2017. Toys "R" Us has filed for bankruptcy protection in the United States and says it intends to follow suit in Canada. Toys "R" Us Canada says the struggles of the wider toy chain have been impacting its strong Canadian business. THE CANADIAN PRESS/Paul Chiasson

Toys “R” Us Canada says the struggles of the wider toy chain have been impacting its strong Canadian business.

The toy retailer’s Canadian subsidiary was granted creditor protection in the Ontario Superior Court on Tuesday, one day after Toys “R” Us started bankruptcy proceedings south of the border.

Toys “R” Us Canada said in court documents filed Tuesday that the big-box retailer’s Canadian arm has achieved strong financial performance in recent years.

However, Toys “R” Us Canada says it is not immune to the broader toy chain’s woes, which has prompted some of its suppliers to require more safeguards such as deposits and cash on delivery.

The move for creditor protection on both sides of the border comes as retailers gear up for the crucial holiday shopping season.

Toys “R” Us Canada says it has secured new financing and all 82 of its stores across Canada as well as its e-commerce websites will remain open for business as the company restructures.