Ann Arbor-based Borders Group Inc., the second-largest U.S. bookstore chain, announced Monday that it is asking a bankruptcy court for approval to sell the company to a group of liquidator after canceling an upcoming bankruptcy auction.
According to reports by the Detroit News, the Ann Arbor based company said in a statement that it will sell itself to a group of liquidators led by Hilco Merchant Resources, after it failed to find a buyer willing to keep the company in operation.
The liquidation, which Borders announced shortly after 4:10 p.m. local time Monday, indicates that the 10,700 people who still work for Borders will lose their jobs, and roughly 400 remaining stores will be closed.
"For decades, Borders stores have been destinations within our communities, places where people have sought knowledge, entertainment, and enlightenment and connected with others who share their passion. Everyone at Borders has helped millions of people discover new books, music, and movies, and we all take pride in the role Borders has played in our customers'lives," Borders President Mike Edwards said.
Borders' liquidation comes five months after the company filed for Chapter 11 bankruptcy protection with hopes of shedding unprofitable stores, reducing debt and reemerging by September as a viable company.
But the company has continued to lose millions of dollars every month, as it had closed more than 230 stores since its bankruptcy filing.
Borders had hoped to sell itself to buyout firm Najafi Cos, which owns the Book-of-the-Month Club, the deal fell apart last week after creditors objected to the proposed sale, arguing that nothing would prevent Najafi from liquidating Borders on its own.
Instead, Borders will be sold to a team of liquidators, which are expected to launch going-out-of-business sales as soon as Friday with the "wind-down" complete by September.
