Update: Borders Group Inc., the Michigan-based bookstore chain, will soon be closing all 399 of its stores including its Riverhead location, according to a press release issued by the company this afternoon.
The chain announced it plans to sell its assets to liquidators after it failed to find a buyer that would keep the company in business.
The company will be starting the liquidation process as soon as Friday, with closures continuing into September.
“We were all working hard towards 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 Borders Group President Mike Edwards.
It was not immediately clear when the Riverhead store would close.
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The Riverhead Borders Books store is safe for now, but the overall future of Borders Group in general is still up in the air.
Borders has been contemplating closing additional stores as part of a bankruptcy procedure, and while the Riverhead store was not on the original list of about 200 stores to be closed nationwide, it was later added to a list of about 40 stores that would be closed unless they could get their landlords to give them a better lease agreement.
That is now longer the case.
“It’s staying open for the foreseeable future,” Borders spokesperson Mary Davis said of the Riverhead location, which opened in 2003. “This is because we worked with lenders to come to an agreement that alleviated the need to conduct closing sales for those 40 stores that Riverhead was a part of.”
As for whether Borders Group in general survives, the company on June 30 entered into an asset purchase agreement with Direct Brands, the company that owns the Book-of-the-Month Club, Doubleday Book Club and other book clubs, according to a Borders’ press release.
Under the agreement, which must be submitted to the bankruptcy court for approval, Direct Brands would purchase all of Borders’ assets for $215 million plus the assumption of about $220 million in liabilities. The tentative purchase agreement will occur prior to the next court hearing, on July 21, the Borders’ release states. The company anticipates the sale, if accepted, will be completed by the end of this month.
“If consummated and under the terms of the agreement, Borders would operate as a wholly owned subsidiary of Direct Brands,” the release states. “As part of the agreement with Direct Brands, Hilco and Gordon Brothers have agreed to acquire any store locations that are ultimately not included in the sale and will close those stores in an orderly manner.”
Since the Riverhead store is no longer on the list of stores slated for closing, it would presumably remain open if the deal is accepted.
Ms. Davis would not elaborate on anything in the release.