Bankruptcy Judge OKs Borders' Liquidation Petition
NEW YORK—Borders Group, the nation's second largest book retailer, stood at the brink of extinction after a bankruptcy judge approved the liquidation of its 40-year-old business. The move will result in the closing of 399 stores and will impact nearly 11,000 jobs. Borders is also working on a side deal with fellow bookstore chain Books-A-Million that could save as many as 35 stores and 1,500 jobs.
An attorney for Borders told Reuters that the plan being negotiated would see Books-A-Million acquire the inventory and merchandise at certain stores. As for the liquidation itself, it is expected to realize between $250 million and $284 million, which Borders will use to pay back creditors.
A private equity firm that owns the Book-of-the-Month Club had offered $215 million in cash and $220 million in assumed liabilities—a move that would have kept Borders afloat and saved the jobs—but the objection of creditors put the kibosh on a last-minute save.