DOW JONES NEWSWIRES Borders Group Inc. (BGP) announced that an entity controlled by Vector Group Ltd. (VGR) Chairman Bennett LeBow has agreed to invest $25 million in the struggling bookseller as the company continues efforts to boost capital levels. LeBow will also become Borders's chairman. Howard Lorber, president and chief executive of Vector--a tobacco company--will also join Borders's board. Meanwhile, Richard McGuire has resigned as chairman and left the panel as the investment's terms call for a nine-person board. The company announced $790 million in new financing in March as Borders deals with an ongoing sales decline. The company said Friday that the investment from LeBow--which is buying 11.1 million shares at $2.25 each, a 0.9% premium to Thursday's closing price--will help to boost digital efforts and improve brick-and-mortar results. The stock recently fell 3.1% premarket to $2.16. LeBow's stake would give him roughly 15% of the shares outstanding. Borders said in March its fiscal fourth-quarter profit doubled on smaller write-downs while revenue fell 13%. First-quarter results are due Thursday. -By Jodi Xu, Dow Jones Newswires; 212-416-3037; jodi.xu@dowjones.com
