Borders Group Inc. announced on Monday that it will close all of its stores and sell the company to a group of liquidators led by Hilco Merchant Resources.
"Following the best efforts of all parties, we are saddened by this development," said Borders President Mike Edwards in a statement.
The company will start closing down its remaining 399 stores as early as Friday, though the liquidation will likely last through September. The remaining number of Borders stores is only about two-thirds the number of locations the company had when they filed for bankruptcy protection on Feb. 16. Borders currently has nearly 11,000 employees that will soon be out of work.
"We were all working hard toward a different outcome, but the headwinds we have been facing for quite some time, including the rapidly changing book industry, eReader revolution and turbulent economy, have brought us to where we are now," said Edwards.
Borders had originally hoped to find someone to purchase and operate the company, but when a deal fell through with Najafi Companies (owners of the Book-of-the-Month Club), they decided to liquidate. Najafi had offered $215 million in cash and another $220 million in liabilities to acquire assets, but the deal collapsed when creditors rejected terms that said Najafi could liquidate even after the sale was made.
Borders began in 1971 when Tom and Louis Borders opened a used bookstore in Ann Arbor, Mich. In 1992, the company was purchased by Kmart, which helped to expand it from 21 locations to over 200 in just five years.
In 2008, the company tried, unsuccessfully, to sell itself in the midst of fierce competition from online retailers. In February of this year, the company filed for bankruptcy and held going-out-of-business sales at 200 of its stores. Borders is the second largest bookstore chain in the U.S., just behind Barnes and Noble.
Reuters reports that a Borders attorney, Andrew Glenn, said that the company expects a liquidation sale to bring in somewhere between $250 million and $284 million.
Edwards took some time during the announcement to also express his gratitude to those who helped Borders become what it had become over the last 40 years.
"For decades, Borders stores have been destinations within our communities, places where people have sought knowledge, entertainment, enlightenment and connected with others who share their passion. Everyone at Borders has helped millions of people discover new books, music, movies, and we all take pride in the role Borders has played in our customers' lives," he said. "I extend a heartfelt thanks to all of our dedicated employees and our loyal customers."