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Borders CEO "comfortable" with liquidity

Thu Jun 12, 2008 6:32pm EDT
 
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By Poornima Gupta

ANN ARBOR, Michigan (Reuters) - U.S. bookstore operator Borders Group Inc (BGP.N: Quote, Profile, Research, Stock Buzz) has a "comfortable" liquidity position that allows it more "flexibility" in evaluating bids from potential buyers, its chief executive said on Thursday.

"Being in a better position in terms of our liquidity and debt certainly gives us more flexibility in terms of evaluating the offers," CEO George Jones said in an interview.

Borders, the No. 2 U.S. bookseller after Barnes & Noble Inc (BKS.N: Quote, Profile, Research, Stock Buzz), has been working to cut operating expenses and reduce inventory to help offset declining sales.

Based in Ann Arbor, Michigan, Borders put itself up for sale in March. Barnes & Noble has said it was interested in possibly acquiring its rival.

Borders has struggled with liquidity issues, but recently received a new financing commitment from its largest shareholder, Pershing Square Capital Management.

William Ackerman, the billionaire hedge fund manager who is the founder of Pershing Square Capital Management, said this week the bookseller should consider selling the company to online retailer Amazon.com Inc. (AMZN.O: Quote, Profile, Research, Stock Buzz)

Jones said the company was still in the beginning of the sale process and remained on track to meet its own restructuring targets and reduce its debt this year.

"We are headed to getting our debt levels down to a very healthy level... by the end of the year," he said.  Continued...

 

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