Borders Asks for Landlord Patience13 Jul, 2011 By: Chris Tribbey
In advance of a planned auction of its assets, bankrupt retailer Borders Group Inc. is defending itself in court against an onslaught of landlords complaining about the process.
Court filings on behalf of landlords with Borders leases are objecting to the planned July 19 auction, claiming Borders isn’t keeping them informed about the sale process.
“[Borders] truly value[s] their relationships with landlords, who have worked constructively with the debtors throughout these cases in their continuing efforts to rationalize their store footprint and their occupancy costs,” Borders responded in July 12 court documents. “Accordingly, the debtors are seeking to resolve as many objections as possible before the sale hearing to assuage any concerns that the landlord community has about the proposed transaction.”
If no bid comes for Borders’ auction, it’s possible the July 1 bid by Direct Brands, parent of mail-order disc service Columbia House, among other services, would go through. That bid includes the bookstore company’s assets for $215.1 million plus assuming $220 million of liabilities.
“The sale simply cannot take place in the timeframe required if there are any further delays in the schedule,” the July 12 court filing reads.
Since filing for bankruptcy in February, the retailer has closed roughly a third of its 640-plus stores.
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