A Mastermind Toys store is featured in Toronto's Rosedale neighborhood on Friday, November 24, 2023. The Canadian toy company has announced a recent agreement to transfer the majority of its business operations to Unity Acquisitions Inc., as reported by Tess Ha for CBC.
Time is running out for Mastermind Toys patrons holding store gift cards, as they have less than a week left to redeem them. The Canadian toy retailer recently revealed its entry into an asset purchase agreement with Unity Acquisitions Inc., an announcement made earlier this month. However, this move comes on the heels of Mastermind filing for creditor protection under the Companies Creditors Arrangement Act (CCCA) on November 24.
In a recent email to CBC News, company spokesperson David Ryan conveyed that customers will no longer be able to use their gift cards at any of Mastermind's 66 locations after Christmas Eve. Ryan clarified, "Gift cards will not be accepted after December 24 for the remainder of the CCAA (Companies' Creditors Arrangement Act) process, until the acquisition of Mastermind by Unity Acquisitions Inc. closes." This information is being actively shared with customers at the company's physical stores.
A notice posted on the entrance of the Mastermind Toys outlet in Coquitlam, B.C., explicitly stated that gift cards would only be valid until the close of business on December 24. As for the potential acceptance of gift cards post-acquisition, Ryan remained uncertain, noting that confirmation would only come after the completion of the deal with Unity Acquisitions, expected in January.
Mastermind Toys, under the ownership of Birch Hill Equity Partners Management Inc., has been grappling with heightened competition, disruptions induced by the COVID-19 pandemic, and the recent strain on the economy leading to reduced consumer spending.
The toy retailer's decision to file for creditor protection on Black Friday, a traditionally lucrative sales period, was met with an Ontario court granting permission to liquidate a portion of its stores. In total, Mastermind plans to shutter 18 out of its 66 stores, with closures spread across nine locations in Ontario, four in Alberta, two in New Brunswick, and one each in B.C., Nova Scotia, and Manitoba.
The acquisition by Unity Acquisitions Inc., led by Joe Mimran, Frank Rocchetti, and David Lui, presents a potential lifeline for Mastermind Toys. Mimran, known for founding Club Monaco and creating the Joe Fresh brand, has recently played a role in revitalizing Tilley Endurables Inc. with Rocchetti. Lui, with experience at Canadian Tire Corp. Ltd.'s brands Sport Chek and Mark's, serves as the CEO of clothing retailer Kit and Ace, which the trio co-owns. Their business portfolio also includes Casca Footwear, a premium shoe company based in Vancouver.
Although the financial terms of the Mastermind-Unity deal remain undisclosed, it encompasses the majority of Mastermind Toys store locations and is expected to facilitate the continuity of a "significant" portion of the company's workforce, which currently stands at 800 employees. Established in 1984, Mastermind Toys proudly holds the title of Canada's largest specialty toy and children's book retailer.
