Borders Seeks Buyer as Bankruptcy Judge Extends Restructuring Deadline

6/6/2011
Borders is reportedly in talks to sell more than half of its 405 still-open bookstores to private equity firm Gores Group. The retailer had declared Chapter 11 bankruptcy in February 2011, and has since closed more than 200 of the nearly 650 stores it operated at that time.

The potential deal with Gores Group would involve 200 to 225 stores and could be in the $200 million range, according to the Wall Street Journal and other published reports. However, the talks were described as "fluid" and might not come to fruition. Gores has a portfolio of investments including Alliance Entertainment, Westwood One, Siemens Enterprise Communications and Big Strike Inc.

Even if the sale does not take place, Borders has been granted some breathing room by the U.S. Bankruptcy Court in Manhattan. Judge Martin Glenn approved extending the retailer's deadline to file a reorganization plan until October. If the request had not been approved, Borders' exclusivity period to file a plan would have run out on June 16. Such requests are typical and are generally granted in bankruptcy cases.

Borders' woes are not limited to North America. The nine remaining Borders stores in Australia are slated to close by mid-July, according to published reports. The stores are owned by the financially troubled company REDgroup Retail, which also operates the Angus & Robertson chain. An administrator has already closed 55 Borders and Angus & Robertson stores since its appointment four months ago.

For related content see: Borders Store Closings Top 200 with 28 More Shuttered Units

Borders Files for Bankruptcy, Closes 200 Stores
X
This ad will auto-close in 10 seconds