The Internet strikes again. The overwhelmingly popular e-this and e-that trends – which of course encompasses the e-book – has lead to the second-largest U.S. bookstore chain, Borders Group Inc, filing for bankruptcy.
The company’s inability to manage accrued debt – which Reuters reported financial liabilities somewhere in the ballpark of “$1.29 billion and assets of $1.28 billion as of December 25, 2010, according to documents filed on Wednesday with U.S. Bankruptcy Court in Manhattan” – is forcing them to close nearly one-third of their stores.
Mike Edwards, President and CEO of the Borders Group, recently sent his book club members an explanatory email regarding their sudden Chapter 11 move that commenced February 16. In the letter, he said, “Over the next several weeks, Borders will be closing underperforming stores within our network. Should your local store be affected, please visit Borders.com to find another Borders store near you, or to purchase from our incredible selection of books, music and movies.”
The report went on to state that, “In bankruptcy, GE Capital will provide Borders with $505 million in debtor-in-possession financing to allow it to continue operating, contingent on court approval.“ Another report from CNN Money claims that there is word of an upcoming fire sale style liquidation at some of the aforementioned poorly performing stores Edwards discussed in his letter. Borders spokesman Donald Cutler said today, “There will be opportunities for liquidation-type sales. Specifications about them will be revealed in the coming days and weeks.”
Frankly, I’ve never been, how do you say, a book guy. Personally, I knew they were heading south about nine months ago when I found myself needing a bathroom at the 3rd Street Promenade in Santa Monica and Borders told me I had to be a customer and to try the Starbucks next door. What? Are you kidding me? I thought that clean bathrooms and magazines you can read cover to cover for free without anyone saying boo was single-handedly the reason half these goofy looking ba**ards were in here in the first place!
Now if you’ll excuse me, I’m going to read an e-book downloaded from Amazon on my Kindle in the Starbucks bathroom located in the front of Barnes & Noble.Tags: Bankruptcy, books, Borders, e-book, kindle