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Mastermind Toys sells most of business, closing 18 stores

Ailing toy retailer Mastermind GP Inc. says it has reached a deal to sell the bulk of its business to a company representing three big names in the Canadian retail world.

The Toronto-based chain announced Monday that it has signed an asset purchase agreement with Unity Acquisitions Inc., a company run by Joe Mimran, Frank Rocchetti and David Lui.

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Mastermind and Unity did not disclose the financial terms of their deal, which is still subject to court approval but is expected to close in January.

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The deal includes the majority of Mastermind Toys store locations and will allow a “significant” portion of the company’s 800 employees to continue with the business.

“The acquisition aligns with Unity’s strategy to enhance and grow extraordinary Canadian brands,” Joe Mimran said in a statement.

“We are thrilled to have the opportunity to work with the team at Mastermind Toys and take the brand and the business to the next level.”

Mimran is best known for founding Club Monaco, creating the Joe Fresh brand for grocer Loblaw Companies Ltd., and in more recent years, helping revive hat business Tilley Endurables Inc. with Rocchetti.

Meanwhile, Lui has spent time at Canadian Tire Corp. Ltd.’s brands Sport Chek and Mark’s, and is chief executive of clothing retailer Kit and Ace, which the trio also own. The group also owns Casca Footwear, a premium shoe company from Vancouver.

Mastermind is owned by Birch Hill Equity Partners Management Inc. and has been facing increasing competition, disruptions from the COVID-19 pandemic and more recently, a deteriorating economy that has customers spending less.

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These factors have been so severe Mastermind has been trying to sell its business and last month filed for creditor protection.

The store began telling customers last week that it would close 18 of its 66 stores.

The stores closing include nine locations in Ontario, four in Alberta, two in New Brunswick and one each in British Columbia, Nova Scotia and Manitoba.

An Ontario court granted Mastermind permission to liquidate stores last week, saying the sales must be wrapped up by Feb. 29.

Despite some stores closing, Mastermind says its holiday sales and promotions will continue. It has also introduced an extended holiday return and exchange policy for purchases made online and in stores, other than at the 18 stores conducting liquidation sales.

Mastermind Toys to close 18 stores, will sell bulk of its business to Unity Acquisitions

Ailing toy retailer Mastermind GP Inc. says it has reached a deal to sell the bulk of its business to a company representing three big names in the Canadian retail world.

The Toronto-based chain announced Monday that it has signed an asset purchase agreement with Unity Acquisitions Inc., a company run by Joe Mimran, Frank Rocchetti and David Lui.

Mastermind and Unity did not disclose the financial terms of their deal, which is still subject to court approval but is expected to close in January.

The deal includes the majority of Mastermind Toys store locations and will allow a “significant” portion of the company’s 800 employees to continue with the business.

A representative for Mastermind Toys said the exact number of jobs impacted by the closures has not been finalized. The company also declined an interview with CBC News.

“The acquisition aligns with Unity’s strategy to enhance and grow extraordinary Canadian brands,” Joe Mimran said in a statement.

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“We are thrilled to have the opportunity to work with the team at Mastermind Toys and take the brand and the business to the next level.”

Retail Insider Media publisher Craig Patterson told CBC News he was surprised to see Unity Acquisitions buy Mastermind, given that the acquisitions firm has a foothold in the fashion retail world.

“If they’re bringing on a toy retailer then it looks like Unity could be maybe looking to diversify its holdings and who knows [what] they may acquire next,” Patterson said.

Unity has “a really good leadership team behind them that has seen success with retail across all kinds of different businesses in the past,” he added.

Filed for creditor protection last month

The Canadian toy retailer filed for creditor protection on Nov. 24 — Black Friday, the biggest shopping day of the year.

Mastermind is owned by Birch Hill Equity Partners Management Inc. and has been facing increasing

Bed Bath & Beyond gift cards to expire weeks before company closes its Canadian stores

When Ann Hull of Barrie, Ont., visited her local Bed Bath & Beyond store last week, she bought an ice cream scooper and a paper towel holder, determined to use her $50 gift card before it was too late.

“It was not what I really wanted,” she said. “I was disappointed and I was definitely frustrated.”

The U.S.-based Bed Bath & Beyond retail chain is in financial trouble, so it’s closing all of its 54 Bed Bath & Beyond stores and 11 buybuy BABY locations in Canada.

Last month, Bed Bath & Beyond Canada was granted bankruptcy protection by the Ontario Superior Court of Justice.

The company told CBC News its Canadian stores are set to close sometime next month, but customer gift cards and Welcome Rewards points will expire next week — on March 9.

Ann Hull of Barrie, Ont., purchased an ice cream scooper and paper towel holder with her $50 Bed Bath & Beyond gift card before it expires. The retailer’s Canadian stores are set to close sometime next month, but customer gift cards and Welcome Rewards points will expire on March 9. (CBC)

Hull said she thinks the March 9 deadline is unfair.

“There’s going to be a lot of disappointed people,” she said. “I think they should be honouring the gift cards right until their doors close.”

Can gift cards expire?

Typically, gift cards can’t expire in Canada as mandated by provincial consumer protection regulations. But that rule no longer applies when a company seeks bankruptcy protection — leaving the courts to determine whether, and for how long, a retailer’s gift cards will be accepted.

“Generally, the judge will accept the company’s recommendation, but it is ultimately the judge who needs to approve it,” said insolvency lawyer Geoffrey Dabbs.

Bed Bath & Beyond did not answer questions about the March 9 deadline, except to say that it had been extended following an initial expiry date of Feb. 25.

A Bed Bath & Beyond gift card — Typically, gift cards can’t expire in Canada, but that rule no longer applies when a company seeks bankruptcy protection. (Bed Bath & Beyond )

Dabbs said gift cardholders are fortunate they have a window of opportunity to redeem their cards, as they join a long list of unsecured creditors owed money by Bed Bath & Beyond Canada.

“The unsecured creditors on the bottom typically get little or nothing,” said Dabbs, a partner with Gehlen Dabbs Cash LLP