- (Photo: Reuters / Mike Blake)
A federal bankruptcy judge approved Borders Group's plan to liquidate late Thursday, which means a going-out-of-business sale will start today at many of the bookstore's 399 locations.
The nation's second-largest book chain, which filed for bankruptcy in February, said all of its stores will be closed by the end of September. Some could be shuttered before then if all inventory is sold off.
However, there could be a reprieve for at least some of Michigan-based Borders' approximately 11,000 employees expected to be shortly out of work. Birmingham, Ala.-based book chain Books-A-Million has said it wants to buy 30 to 35 of the closing Borders locations and operate them under the Books-A-Million banner.
Books-A-Million, which owns 231 stores throughout the nation, said in a statement that the move could save about 1,500 jobs.
The book company has said its offer is to purchase, among other things, the inventory, fixtures, equipment, and leasehold interests for the Borders locations. The company did not state specifically which Borders locations it would be looking to take over.
Meanwhile, merchandise at Borders stores that are closing will be discounted by as much as 40 percent.
Stores will continue to accept Borders gift cards through the liquidation and Borders Bucks may be redeemed through July, the company said in a news release.
Analysts and industry-watchers have said Borders' demise was not only due to competition from online retailers, but over-expansion and also a slow approach to embracing the digital age. Whereas competitor Barnes & Noble quickly developed its e-reader, called the Nook, to compete with Amazon's Kindle, Borders waited several years to roll out its e-reader, called Kobo.
“Their reaction to the changing economic conditions has been less than perfect," said Nejat Seyhun, a University of Michigan corporate finance professor, to The Associated Press. "I'm not sure I'd use the word victim, but they were certainly affected by both changing technology and changing taste."
Borders released a prepared statement on the liquidation news, saying "We were all working towards a different outcome, but the headwinds we have been facing for quite some time, including the rapidly changing book industry, e-reader revolution and turbulent economy have brought us to where we are now."
At its peak, in 2003, Borders operated 1,249 Borders and Waldenbooks throughout the U.S.