Borders Chap. 11 filing rumored this week

sadbook2.jpgUh-oh.

The troubled Ann Arbor, Mich., bookseller could file for Chapter 11 bankruptcy-protection as soon as Monday or Tuesday, paving the way for hundreds of store closings and thousands of job losses, said people familiar with the matter.

Borders has abandoned efforts to refinance its debts, and is preparing bankruptcy papers and seeking financing agreements that would keep it operating during the Chapter 11 restructuring process, the people said. Its shares tumbled 33% to 25 cents apiece in 4 p.m. New York Stock Exchange trading after The Wall Street Journal reported its plans.


According to the Wall Street Journal, the filing would allow for stores to continue to operate during bankruptcy proceedings, but the company would close a third of its stores and lay off a significant number of its 19,500 employees. Observers are skeptical that the chain can reinvent itself, however, and are throwing around the “L” word: liquidation.

While the article blames declining interest in physical bookstores in the face of Amazon and digital books, it’s important to remember that Borders has made a lot of business mistakes on the way to this sad state of affairs.

Comments

  1. Sorry to see people lose their jobs. I guess we’ve all seen this coming for a long time. :

  2. “It is expected to report more than $1 billion in liabilities in its bankruptcy petition, said a person familiar with the matter.”

    I hope it doesn’t result in liquidation.

  3. R. Maheras says:

    Sad. Very, very sad.

    No wonder the old crank who ran the corner store where I bought my comics as a kid used to hyperventilate when he caught us reading the comics instead of buying them.

    I guess the “This ain’t no library” business model actually makes sound financial sense.

  4. Not for nothing, but in case nobody else has said it yet, I really like the spot illos you’re using to accompany your stories of late.

  5. Dan DeLaet says:

    @ R.Maheras i am there with u man. I used to work at Whitcoulls in New Zealand, kids got kicked out the store for the same thing. House wives buying the new Jamie olliver and teen age girls buying the new twilight book, sad but that is the book franchise shops now. Sad.

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