Toys R Us could apply on Monday for a ‘company voluntary arrangement’, which will allow restructuring, sources have revealed. 

If approved by the company’s creditors, around a quarter of its stores will close - mostly the larger, warehouse-style outlets which are becoming increasingly inefficient. 

Around 25 of the toy chain’s 105 shops will face closure, Sky News has reported. 

The company currently employs roughly 3,200 people in the UK. Closures would therefore impact hundreds of jobs. 

All of the stores would remain open during the Christmas period and into the new year. 

Sky News' business editor Mark Kleinman said: "It’s been a pretty bleak day for the British High Street. I’m afraid I’ve got more bad news.

"Next week I understand Toys R Us will announce plans to close a quarter of its British shops.

"Toys R Us in the US have been going through a period of restructuring. It will announce in Monday it will file for a process called a company voluntary arrangement.

"What that essentially does is shield themselves from their creditors while they carry out a period of financial restructuring.

"Unfortunately this process, if approved, will put hundreds of jobs at risk because the company employs roughly 3,200 people."

Toys R Us has been contacted for comment. 

A spokesman for the company declined to give a comment when contacted by Express.co.uk.