Wednesday, 16 February 2011
Another one bites the dust - Bye Bye Borders
Borders put itself up for sale in March 2008 and speculation mounted that Barnes & Noble would buy it. Borders ended the process in November of that year without finding a bidder, and Pershing sold its Barnes & Noble stake in December 2008.
Ackman also approached Leonard Riggio, founder and chairman of Barnes & Noble, and Ronald Burkle, a large Barnes & Noble investor, about combining the companies, according to court documents and testimony from a lawsuit last year. Riggio declined to pursue a deal for Borders because he didn’t want any more exposure to retail space, court documents showed.
On Dec. 6, Pershing offered to help Borders fund an all- cash acquisition of Barnes & Noble for $16 a share, valuing the chain at about $960 million. At the time, Barnes & Noble declined to respond.
Now Borders’s bankruptcy could put $550 million in revenue up for grabs, Gary Balter, an analyst for Credit Suisse, wrote yesterday in a note to clients. The closings may increase sales at Barnes & Noble superstores 6 percent, said Balter, who has a “neutral” rating on Barnes & Noble shares.