Borders goes into administration

Book retailer Borders UK has gone into administration.

Insolvency company MCR was appointed yesterday (26 November) after discussions with potential buyers for Borders’ 45 UK stores failed.

The administrator says stores will remain open while the search for a buyer continues, adding that all outstanding wages had been paid.

The appointment of an administrator had been delayed after first choice BDO discovered a potential conflict of interest yesterday (27 November).

MCR says the retailer has “severe cash flow pressures” and that several suppliers had stopped or reduced its credit.

The firm has lost business to internet book retailers and cheaper high street rivals in recent years.

WH Smith reportedly walked away from a rescue deal to buy 36 of Borders’ 45 UK stores last Friday (20 November) and it was thought to be holding talks with other potential buyers including HMV, which owns rival bookseller Waterstone’s about a possible full or partial sale.

In addition, it has also emerged that talks between Borders and its digital agency Tangent about taking over the retailer’s online arm are thought to have collapsed because of the uncertainty over the future of the book sellers’ UK business.

Borders had been looking to offload the online arm of its business to focus on its core store offering.

The retailer had held talks with Tangent about the digital agency taking over the business and running it in-house.

The book seller 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, in a statement at the time of the deal, said that it would allow the business to “develop our innovative approach to bookselling”.

Latest from Marketing Week

PLEASE SIGN IN OR REGISTER. IT'S FREE, QUICK AND EASY!

Access Marketing Week’s wealth of insight, analysis and inspiration that will help you develop as a marketer and leader.

Register and receive the best content from the only title 100% dedicated to serving marketers' needs.

We’ll ask you just a few questions about what you do and where you work, so we can make Marketing Week more relevant to you.

Register now

THE BEST CONTENT

Our award winning editorial team and columnists will ask the biggest questions about the biggest issues on everything from strategy through to execution to help you navigate the fast moving modern marketing landscape.

THE BIGGEST ISSUES

From the opportunities and challenges of emerging technology to the need for greater effectiveness, from the challenge of measurement to building a marketing team fit for the future, we will be your guide.

PERSONAL AND PROFESSIONAL DEVELOPMENT

Information, inspiration and advice from the marketing world and beyond that will help you develop as a marketer and as a leader.

Dedicated to developing your skills and helping you achieve marketing excellence. Find guidance on leadership, professional development and the latest industry jobs.

Having problems?

Contact us on +44 (0)20 7292 3711 or email subscriptions@marketingweek.com

If you are looking for our Jobs site, please click here