Mastermind Toys gift cards won't be accepted after Christmas Eve, company warns

CTV National News: Mastermind to be acquired Mastermind has reached a deal to the sell the bulk of its business, saving the toy retailer from bankruptcy. Jon Erlichman has more.

If you're sitting on an unused Mastermind Toys gift card, now is the time to spend it.

The cash-strapped company's toy and book stores are set to come under new ownership in early 2024 and it has warned existing gift cards will become invalid on Dec. 24.

Mastermind announced it had sold most of its 66 store locations to Unity Acquisitions Inc. on Dec. 4 after filing for creditor protection under the Companies' Creditors Arrangement Act (CCCA) in November.

"Gift cards will not be accepted after Dec. 24 for the remainder of the CCAA process, until the acquisition of Mastermind by Unity Acquisitions Inc. closes," David Ryan, a spokesperson for Mastermind Toys, told CTVNews.ca in an email on Wednesday. "The transaction is expected to close in January."

Ryan could not say whether cards would be accepted again once the deal had closed.

In the meantime, the toy company has also introduced an extended holiday return and exchange policy for purchases made online and in-stores, excluding 18 stores undergoing court-approved liquidation.

CHALLENGES 'TOO SIGNIFICANT TO OVERCOME'

Mastermind sought creditor protection, a court process for companies owing more than $5 million in debt, on Nov. 23 to protect its assets from creditors while it looked for alternatives to filing for bankruptcy.

At the time, the company said it had struggled to overcome challenges including increased competition, disruptions from the COVID-19 pandemic and a deteriorating macro-economic environment.

"Despite implementing a series of operational improvements and cost reductions, and undertaking an extensive strategic review and conducting a robust sale process, the challenges facing the Company's business have become too significant to overcome," the company wrote in a media release on Nov. 24.

The sale of Mastermind's stores to Unity Acquisitions — co-led by Joe Fresh founder Joe Mimran — will ensure most of its stores remain open, the company announced on Dec. 4.

Mastermind Toys opened its first store in Toronto in 1984 and was founded by brothers Andy and Jon Levy, according to the company's website.

With files from CTVNews.ca Writer Dorcas Marfo