Toys ‘R’ Us Australia and New Zealand has officially entered administration for the second time, resulting in its suspension from the Australian Securities Exchange (ASX) as it searches for prospective buyers.

The company's difficulties were outlined in a statement Wednesday when it disclosed that it could no longer pursue a solvent recapitalisation plan, indicating its likely insolvency.

The retailer had transitioned to an online-only business model after it first appointed administrators in 2018, but efforts to restructure its financial framework proved unsuccessful.

In the ASX announcement, Toys ‘R’ Us confirmed that it was unable to establish a viable pathway forward amidst ongoing financial challenges.

Administrators Luke Andrews and Duncan Clubb from BDO Restructuring Partners have taken control of the company, along with its subsidiaries, including Babies ‘R’ Us, Hobby Warehouse, and Riot.

They stated operations would continue as usual wherever feasible while they seek to sell or restructure the business.

Following the announcement, ASX compliance officials communicated that the financial condition of Toys ‘R’ Us did not justify the continued listing of its securities, leading to the immediate suspension of its shares.

The history of financial struggles for Toys ‘R’ Us began in the U.S., where its parent company filed for bankruptcy in September 2017, leading to the closure of 735 stores and the loss of approximately 33,000 jobs.

In Australia, efforts to find buyers during its previous administration ultimately fell through, resulting in the loss of 700 jobs and the shutdown of 44 stores.

Following this, the brand was acquired by WHP Global, which took over the Toys ‘R’ Us name and licensed it across 31 markets.

The Australian operation was later revitalized by an ASX-listed toy retailer, Funtastic, which rebranded as Toys ‘R’ Us ANZ and commenced online sales in late 2019. However, the store endured ongoing financial difficulties, including consecutive losses.

The financial records indicate that in the fiscal year 2023, the business recorded a loss of $32.7 million, compared to a loss of $24.8 million in the previous year, as revenue plummeted from $37.9 million to $21.6 million.

For fiscal year 2024, revenue was reported at just $7.7 million, with losses of $19.4 million.

Penny Cox, an e-commerce executive, was appointed as the company's chief executive in mid-2023 with objectives to enhance the brand’s online presence.

However, she resigned after a brief tenure of less than two years.

As the company moves forward with the administration process, an initial meeting with creditors is scheduled to take place within a week.