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Bookshop chain goes into administration
Bookshop chain Borders, which has a major store at Preston's Deepdale Retail Park, has gone into administration.
The firm, which employs 1,150 people at 45 Borders and Books Etc stores across the UK, has come under "severe" pressure from online competition in the past 12 months, administrator MCR has said.
In a statement issued on Thursday night, MCR said all stores, including the branch in Preston, will continue to trade while the financial position of the company is assessed.
Administrators will look for a buyer for the whole chain, the statement added.
It said: "Philip Duffy, Geoff Bouchier and David Whitehouse of MCR have been appointed joint administrators of Borders (UK).
"Borders (UK) has 45 stores, 36 trading as Borders and nine as Books Etc across the UK.
"The joint administrators are currently working with the company's management in order to attempt to sell the business as a going concern.
"The joint administrators are continuing to trade all stores whilst they assess the financial position of the company."
Borders has struggled with cash flow pressure this year as sales falls accelerated, administrators said.
Stock levels were also hit as several of the company's suppliers stopped or reduced its credit limits, while a number of credit insurers have also reduced their cover for the firm.
Joint administrator Phil Duffy said: "All stores currently remain open for business as normal whilst the administrators undertake a review of the company's affairs and seek a purchaser for all or some of the company's stores in which there has already been interest.
"All outstanding employee wages have been paid up to date and ongoing wages for retained staff will continue to be paid as an expense of the administration."
He added that booksellers in general had been hit in the current weakened retail market, with competition on major releases from supermarkets and the internet.
Negotiations
Borders first opened in the UK in 1997 and was originally owned by the US book giant of the same name.
But the UK and Ireland arm was sold to buyout group Risk Capital Partners - headed by Channel 4 chairman Luke Johnson - in 2007.
Management, led by chief executive Philip Downer and finance director Mark Little, then bought the group back with financing from Valco Capital earlier this year.
Valco appointed Clearwater Corporate Finance to find a buyer for the business.
It was reported that WHSmith had been involved in discussions and then pulled out of talks late last week. HMV, the owner of Waterstone's, is also believed to have been talking to Borders management, although it is not thought to be interested in more than a handful of the stores.
Since negotiations over a sale collapsed, Borders has been involved in emergency talks to try to secure its future.
At least two of Britain's biggest publishers, Hachette UK and Random House, recently ceased trading with the chain.
Shoppers have been unable to use Borders' website to make purchases since Monday, with any attempt to place an order producing a message stating: "Borders.co.uk is currently not able to process your order."
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Weather for Preston
Wednesday 08 February 2012
Today
Sunny spells
Temperature: -3 C to 3 C
Wind Speed: 18 mph
Wind direction: South east
Tomorrow
Light sleet
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