Toys"R"Us is to shut a quarter of its British stores, with a loss of up to 800 staff, the troubled US retailer's UK arm announced on Monday.

The US company, which recently filed for bankruptcy in its home market as it struggles to compete with the likes of Amazon, said its larger UK stores no longer made economic sense and that the future lay with smaller outlets.

"Like many UK retailers in today's market environment, we need to transform our business so that we have a platform that can better meet customers' evolving needs," said Steve Knights, managing director of Toys"R"Us UK.