Borders may be sold
The bookstore chain says it will consider a full or partial sale.
NEW YORK -- Borders, the nation's second-largest bookstore chain, said today that it is considering selling all or part of the company, amid worsening conditions in the bookselling business.
Company officials said they have hired JP Morgan and Merrill Lynch to explore "strategic alternatives" for the troubled chain but also cautioned that there was no guarantee any kind of sale would occur.
To provide an economic buffer, the firm also announced a $42.5-million lending commitment from Pershing Square Capital, a hedge-fund firm that has a major shareholders stake in Borders.
Chief Executive Officer George Jones said in a press release that "this will be a challenging year for retailers" because of continuing economic uncertainty for booksellers and other retailers. He reported that the company's income from continuing operations was $84.7 million, or $1.44 per share, in the fiscal quarter ending 2007, compared to $87.7 million and $1.45 per share one year ago.
Booksellers have been experiencing rough times, because of the general economic slowdown among consumers and growing competition from other bookselling sources, such as the Internet and big box retailers, which typically offer steep discounts on bestselling titles.
Although there has been some speculation that Barnes & Noble, the nation's largest book chain, might consider acquiring Borders, such a deal would have to clear significant anti-trust hurdles.
josh.getlin@latimes.com
