Posted on: Friday, December 5, 2003

FAO Schwarz owner files for Chapter 11 bankruptcy again

By Bill Bergstrom
Associated Press

PHILADELPHIA — Unable to pump up holiday sales or find a buyer, the owner of FAO Schwarz toy stores filed for Chapter 11 bankruptcy protection as expected yesterday, less than eight months after emerging from an earlier bankruptcy.

The announcement came three weeks before Christmas, and unless a buyer emerges soon, the chain — including the landmark store on New York's Fifth Avenue where shoppers are greeted by a giant teddy bear playing with blocks — may be hosting its last holiday rush.

It's possible new investors can revive FAO Schwarz, possibly trading on its cachet as a toy boutique for the affluent, but analysts said the toy stores begun by Frederick August Otto Schwarz in 1862 may simply cease to exist.