Toys R Us is poised to unveil plans to shutter a quarter of its UK stores through a company voluntary arrangement (CVA).

The move by the ailing toy chain, which would require approval from 75% of its creditors, would leave around 25 of its 105 British stores facing closure.

The retailer employs approximately 3,200 people in the UK, meaning the decision would impact hundreds of jobs.

According to Sky News, Toys R Us’ UK subsidiary will lift the lid on its CVA proposals this week as it grapples with turbulent trading conditions and onerous property bills.

Toys R Us’ larger out of town sites are expected to be impacted most by the closure plan.

However, the affected stores are set to continue trading throughout the crucial Christmas trading period and into the New Year.

It is understood that corporate insolvency advisers Alvarez & Marsal have been lined up to handle the CVA process.

Toys ‘R’ Us UK operations are understood to have been loss-making in seven of the last eight financial years.

Accounts for the year to January revealed its British business made an operating loss of £500,000, despite raking in sales of £418m.

Toys R Us’ American parent company filed for Chapter 11 bankruptcy protection in September – a process that shields stricken companies from their creditors while they attempt to restructure their finances.