We knew this was going to happen, and now it has come to pass: Borders has filed for Chapter 11 bankruptcy protection and plans to shutter 30% of its stores as a result.
“It has become increasingly clear that in light of the environment of curtailed customer spending… and the company’s lack of liquidity, Borders Group does not have the capital resources it needs to be a viable competitor,” said Borders Group President Mike Edwards.
From the Wall Street Journal:
The company is launching a strategic review of its locations with the aim of closing underperforming stores. Earlier this week, a count of Borders stores using its store locator found it had 644 stores in 48 states, Washington, D.C., and Puerto Rico…
The Ann Arbor, Mich., company also said it has lined up a $505 million loan from GE Capital to fund its operations while in bankruptcy. Access to such a loan is subject to court approval.
As we reported in January, Borders has been unable to pay a number of its bills for the last few months.
The company says it will continue business operations “as normal” and that reward programs and gift cards will be honored.
Speaking of gift cards, if you have any Borders gift cards, use them immediately. Because if/when the company goes the way of the dodo, you’ll be left with nothing but a piece of useless plastic to remember it by.
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