Borders Group Inc. (BGP) confirmed Wednesday that it will close
its Tennessee warehouse by mid-July, eliminating 310 jobs,
Publishers Weekly reported online, adding that the company on
Thursday will take part in talks toward a possible debt
refinancing.
The second-biggest U.S. bookseller had been downsizing the
distribution center in La Vergne, Tenn., near Nashville for about a
year and said in a statement that due to excess capacity it will be
closed for good. Borders will now consolidate the processing and
shipping of books, movies, music and other products from
distribution centers in Carlisle, Pa., and Mira Loma, Calif.
The Ann Arbor, Mich., company said the Tennessee closing is part
of its long-term plan to improve efficiency and cut expenses and
"is not related to Borders' previously reported refinancing effort
or the delay of certain vendor payments in connection with the
refinancing effort."
As The Wall Street Journal reported last week, citing people
familiar with the matter, Borders has been in talks with Wall
Street firms that have worked on high-profile bankruptcies and
other types of restructuring deals. Borders also has been asking
publishers to exchange their receivables for interest-bearing
promissory notes.
Publishers Weekly's report also said a meeting that could shape
Borders' immediate future is scheduled for Thursday afternoon.
According to the trade magazine's sources, publishers will largely
be represented by lawyers and finance executives who hope to hear
more about the retailer's finance and turnaround plan. Publishers,
the report said, were unimpressed with presentations Borders made
last week and need to hear a more robust plan if they are to accept
the company's proposal to issue notes in lieu of payments.
Borders, the Journal reported last week, doesn't currently have
plans to bring aboard bankruptcy and restructuring lawyers and
isn't contemplating a bankruptcy filing.
The company is in talks with General Electric Co.'s (GE) GE
Capital for new debt that would replace an existing senior credit
facility, the Journal cited sources as saying.
Full story at
http://www.publishersweekly.com/pw/by-topic/industry-news/bookselling/article/45757-borders-meeting-set-for-thursday-warehouse-to-be-closed.html
-Dow Jones Newswires; 212-416-2900