Bidder Appears for Borders

The Daily Beast

Lisa Poole / AP Photo

Borders bookstores may have a savior. The private-equity firm Gores Group is in discussions to buy more than half of the bankrupt bookseller in a deal that would keep the business running. Borders has been soliciting offers since it filed for bankruptcy in February. Gores, which buys stakes in distressed companies and tries to rehabilitate them, isn't the only bidder on the horizon, though the other potential buyers haven't been named. Interest in Borders has picked up since Liberty Media's recent bid for Barnes & Noble.

Read it at The Wall Street Journal 

And from PublishersLunch

Gores Group Reportedly "In Discussions" to Buy Over 200 Borders Stores

LA-based private-equity firm Gores Group "is in discussions to purchase" over 200 of Borders' 405 operating stores, the WSJ reports, citing "people familiar with the matter, in a deal that would keep the bookstore chain operating as a going concern." Those people also insist other unidentified parties are in purchase discussions with Borders. And they say the stores and related assets could sell for approximately $200 million. (Though not stated in the article, it implies that the other 200 or so stores would be severed from Borders, perhaps without a buyer or the infrastructure and assets to continue operating.) The same sources "cautioned the talks remain fluid and could fall apart." To put that $200 million in perspective, in their most recent monthly statement, through the end of April, Borders list of assets included a much larger sum of $452.5 million in merchandise inventory.

The paper says that Liberty Media's offer to purchase Barnes & Noble has created additional investor interest in Borders as well. Interestingly, the Gores Group, Liberty's John Malone, and Barnes & Noble investor Ron Burkle all circled Miramax when Disney was selling off the unit. And just last month, Burkle and the Gores brothers were among the potential suitors at one stage of the bidding for Warner Music.

The news came in advance of this morning's omnibus hearing in which Borders seeks more time to formulate a plan to reorganize or sell off part or all of its business to potential bidders, while the unsecured creditors committee seeks no such thing in light of the more than $180 million in losses incurred since Chapter 11 was filed.
WSJ

In Australia, the nine remaining Borders stores (not related to Borders in the US, but owned by the now-bankrupt REDGroup Retail chain) will close after administrators couldn't find a buyer. Stores will shut over the next six to eight weeks with the final closing date set for July 17, with 315 staffers set to lose their jobs.
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