Borders to name bidder by July 1
BANGALORE (Reuters) - Bankrupt bookstore chain Borders Group Inc BGPIQ.PK said it will name a "stalking horse" bidder by July 1 and is looking to complete the sale of all its assets by the end of July.
In court papers filed late on Friday, the company said it was "encouraged that" one of the parties it is presently negotiating with will emerge as the successful buyer on a going concern basis.
"If the debtors (Borders) are unable to consummate a going concern sale of the business that maximizes value, they will proceed with a sale to liquidators," the company said.
On June 15, Borders canceled an auction to select a liquidator to close some of its most profitable and high profile stores.
Although the chain has obtained lease extensions for about 90 percent of its 416 remaining stores, it failed to do so for some of its most successful stores, such as the one at Columbus Circle in New York.
The impasse with the remaining landlords meant Borders was at risk of breaching its loan terms with GE Capital, terms under which it pledged to shut down any stores by June 22 for which it had not obtained a lease extension.
The company said it has now reached a deal with GE Capital, allowing it to keep 51 stores open.
Borders has asked the bankruptcy court to hold an auction on July 19 and a sale hearing by July 22. It plans to close the sale on or before July 29, 2011.
The case is In re Borders Group Inc, U.S. Bankruptcy Court, Southern District of New York, No. 11-10614.
(Reporting by Santosh Nadgir; Editing by Matt Driskill)