Is the purchase of Borders by Direct Brands good news for the employees of the book retailer?

It depends who you're asking. According to the Economist (Goodbye to bricks and mortar) it doesn't look too good:

"Whatever happens at the auction will dictate the fate of the bookseller, which has already closed more than a third of its stores. Because Direct Brands is an online- and catalogue-based distributor of music, DVDs and books (such as the mail-order Book of the Month club), some speculate that a deal with Najafi will do little to keep the remaining bookstores open. Rather, the company will probably see value in the Borders distribution network and liquidate most everything else. Regardless, the story doesn’t look good for store employees and their dwindling patrons. (The company, which employs more than 11,000 people, has racked up more than $191m in losses since seeking bankruptcy protection in February, according to the Wall Street Journal.)"

What do you think? We'll be happy to read your comments.

For more news and updates on Borders post bankruptcy visit our website at http://www.ecolibris.net/borders.asp.

You can also find more resources on the future of bookstores on our website at www.ecolibris.net/bookstores_future.asp

Yours,
Raz@Eco-Libris

Eco-Libris: Planting trees for your books

Finally there's a buyer for Borders - Direct Brands of Najafi will buy Borders for $215 million!

Update from Borders: IB Times reported today that Direct Brands, a portfolio company of Najafi, will purchase Borders' assets for $215.1 million (in addition to assuming roughly $220 worth of liabilities).

According to the article on IB Times Borders agreed to the deal, a "stalking horse bid," after considering two offers, and the Ann Arbor, Mich.-based company plans to seek approval from the bankruptcy court.

So who's the buyer? MarketWatch reported that Direct Brands includes Book-of-the-Month Club, Doubleday Book Clubs, Columbia House DVD and BMG Music Service. It was bought by Phoenix, Ariz.-based Najafi in 2008.

Chicago Tribune wrote that a bankruptcy court hearing on the deal is set for July 21. If the court does not approve an auction process, Borders filed a separate motion to liquidate.

What does this purchase mean for the future of Borders and the future of bookstores in general? We'll keep you posted once more information on the deal will be disclosed so stay tuned.

Yours,
Raz @ Eco-Libris

Eco-Libris: Planting trees for your books!