Toys R Us’ American and Canadian business has filed for bankruptcy protection, just two weeks after it hired lawyers to explore restructuring options.

The toy retailer, which has 1,600 stores worldwide employing more than 60,000 staff, is grappling with massive debts of $5bn, supplier pressure and online competition.

The private-equity-owned company said that its operations outside the US and Canada would not fall under the Chapter 11 bankruptcy protection proceedings.

Toys R Us said that it had already received a commitment for over $3bn in financing from a lending syndicate, which would improve its financial and operational health.

Chairman and chief executive Dave Brandon said: “Today marks the dawn of a new era at Toys R Us where we expect that the financial constraints that have held us back will be addressed in a lasting and effective way.

“Together with our investors, our objective is to work with our debt-holders and other creditors to restructure the $5bn of long-term debt on our balance sheet, which will provide us with greater financial flexibility to invest in our business, continue to improve the customer experience in our physical stores and online, and strengthen our competitive position in an increasingly challenging and rapidly changing retail marketplace worldwide.”