Gifts / Sports & Toys

Ireland-based toy retailer Smyths Toys has beaten a number of rivals to acquire PicWic Toys in France. After the acquisition, Smyths Toys will become the largest toy retail chain in Europe.

Multiple blows to business troubles

PicWic Toys has a certain influence in the toy retail industry in France. The French store that took over Toys "R" Us in 2019 continues to operate. However, according to people familiar with the matter, PicWic Toys at that time was already facing the problem of insufficient funds. At the end of the same year, the company lost 32 million euros. Later, in 2020, it encountered multiple blows such as the closure of the new crown pneumonia epidemic, the impact of e-commerce, and a poor supply chain. As of the end of 2020, PicWic Toys had a turnover of 237 million euros, but a loss of 88 million euros. In the same year, it had no choice but to restructure, and was forced to close 18 stores and lay off one-third of its staff.

After struggling to support in 2021, finally by the end of May this year, unable to recover, they began to seek buyers to take over.

Multi-party bidding, the stronger one wins

The news has attracted bids from many companies, with as many as 15 bids. In early July, the local court announced that Smyths Toys had taken over the French operations of PicWic Toys, including 41 stores, two warehouses, a corporate headquarters and 632 active employees. Smyths Toys will provide 9 million euros in compensation to PicWic Toys' creditors and 300,000 euros for the employment protection scheme. To ensure the smooth running of the company, Smyths Toys will deposit 50 million euros within 15 days.

It is reported that PicWic Toys was founded in 1977. Its founder, Stéphane Mulliez, and Gérard Mulliez, founder of Auchan, the second largest retail group in France, are cousins. Before the reorganization, it was owned by Romain Mulliez and the American fund Cyrus Partners, and it operates about 60 stores in France. store. Éric Feldmann, president of the local commercial court, pointed out that Smyths Toys' bidding proposal ensures the economic sustainability of PicWic Toys, allowing the French toy retail brand to continue for many years.

Smyths Toys' European expansion plans come to fruition

The acquisition of PicWic Toys is Smyths Toys, a family-run toy retailer headquartered in Ireland, which has been in existence for 30 years. The family keeps a low profile in front of the media and rarely discloses financial details about the company's operations.

Prior to this acquisition, the chain acquired Toys R Us' German, Austrian and Swiss businesses in 2018, renamed the store as Smyths Toys Superstores, continued operations, and vigorously expanded its European business, which attracted industry attention. At present, Smyths Toys has 138 stores in the UK and Ireland, and 93 stores in Germany, Austria and Switzerland. Together with the 41 PicWic Toys stores it has taken over, the group has more than 250 stores in Europe, making it the largest in Europe. Toy retail chain group.

Another major merger in the European market

In fact, this is not the first major merger in the European toy market this year. In May of this year, Hape Holding Group and Eurekakids (Chinese translation: Ou Yuxi) Group formally signed an agreement in the Spanish city of Girona, announcing the acquisition of Eurekakids.

Founded in the 1980s, Hape Holding Group is one of the world's largest toy manufacturers using environmentally friendly materials. In 2021, Hape will achieve a total revenue of more than 300 million euros in more than 100 countries and regions around the world. Eurekakids Group was established in Girona, Spain in 2002, and has gradually grown into the largest distributor of educational toys in Europe. Its self-operated physical stores, chain stores, online stores and wholesale channels are complete, forming a distinctive operating model.

Hape plans to add more than 1,000 retail outlets for Eurekakids globally in the next five years. To achieve this goal, Hape will invest more than 10 million euros in the expansion of local warehousing and logistics centers to improve the turnover of goods ability.