Shareholder Urges Amazon Purchase Borders11 Jun, 2008 By: Erik Gruenwedel
A billionaire hedge fund manager who owns 30% of Borders Group Inc. said Internet behemoth Amazon.com should acquire the fiscally challenged bookseller.
William Ackerman, founder of Pershing Square Capital Management, said acquiring Borders' 500 retail locations nationwide would help Amazon diffuse upstart efforts by some cash-strapped states to collect sales tax on e-commerce. The stores would also allow Amazon to offer same-day service in addition to selling non-bookstore product.
"Amazon could buy the company for about $400 million to get those locations that would take more than $1 billion to build," Ackermann told The Associated Press.
Barnes & Noble Inc. last month also expressed interest in acquiring the Ann Arbor, Mich.-based parent of Borders Superstores and Walden Books.
Borders reported a first-quarter 2008 (ended May 3) net loss of $2.2 million, compared to a net loss of $1.6 million in the previous-year period.
Representatives from Borders and Amazon were not immediately available for comment.