18 Feb 2011 03:21:56
Borders said it planned to close around 30 percent of its over 640 stores in the United States as part of its Chapter 11 bankruptcy filing, which protects the company from its creditors while it reorganizes.
"Borders Group does not have the capital resources it needs to be a viable competitor and which are essential for it to move forward with its business strategy," Borders president Mike Edwards said in a statement.
"To position Borders to remedy this condition, Borders Group, with the authorization of its board of directors, has filed a petition for reorganization relief under Chapter 11," Edwards said.
Borders, which has a total of 6,100 full-time employees and 11,400 part-time employees, has lost millions of dollars in recent years as the book industry faces online competition and transitions from print to digital products.
The Ann Arbor, Michigan-based company reported a net loss of 168.2 million dollars in the first 11 months of its latest fiscal year.
In July, Borders launched an online electronic book store to challenge e-readers from Amazon, Apple, Barnes & Noble and Sony in the fast-growing market for digital books.
But the move was seen as coming too late by many industry analysts.
Edwards said Borders has received $505 million in financing commitments from GE Capital, Restructuring Finance.
"This financing should enable Borders to meet its obligations going forward so that our stores continue to be competitive for customers in terms of goods, services and the shopping experience," he said.
Edwards said the financing would give Borders "the time to reorganize in order to reposition itself to be a successful business for the long term."
"Borders Group does not have the capital resources it needs to be a viable competitor and which are essential for it to move forward with its business strategy," Borders president Mike Edwards said in a statement.
"To position Borders to remedy this condition, Borders Group, with the authorization of its board of directors, has filed a petition for reorganization relief under Chapter 11," Edwards said.
Borders, which has a total of 6,100 full-time employees and 11,400 part-time employees, has lost millions of dollars in recent years as the book industry faces online competition and transitions from print to digital products.
The Ann Arbor, Michigan-based company reported a net loss of 168.2 million dollars in the first 11 months of its latest fiscal year.
In July, Borders launched an online electronic book store to challenge e-readers from Amazon, Apple, Barnes & Noble and Sony in the fast-growing market for digital books.
But the move was seen as coming too late by many industry analysts.
Edwards said Borders has received $505 million in financing commitments from GE Capital, Restructuring Finance.
"This financing should enable Borders to meet its obligations going forward so that our stores continue to be competitive for customers in terms of goods, services and the shopping experience," he said.
Edwards said the financing would give Borders "the time to reorganize in order to reposition itself to be a successful business for the long term."
