Rival book seller WH Smith reportedly walked away from a rescue deal to buy 36 of Borders’ 45 UK stores on Friday (20 November).
The firm, which also owns the Books etc chain, is now understood to be holding talks with HMV, which owns rival bookseller Waterstone’s.
However, according to one report, HMV is only interested in buying a handful of Borders stores.
Borders is understood to be concerned it does not have sufficient funds to continue to operate through the busy festive period. It has come under pressure in recent years from often cheaper competition in the form of supermarkets and online retailers.
Its website has now stopped taking orders.
The retailer was the subject of a buyout by its management team in July backed by Valco Capital Partners, the private equity arm of restructuring firm, Hilco.
Borders UK chief executive Philip Downer said in a statement at the time of the deal that it would allow the business to “develop our innovative approach to bookselling”.
Last month, it emerged that it was looking to offload the online arm of its business to focus on its core store offering.
It was thought the book and entertainment retailer was in talks with its digital agency Tangent to take over the business and run it in-house.