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Jan 17 – Jan 23, 2011 Edition Borders Cuts 45 Employees, Offers Deal to Publishers
ANN ARBOR, MICH/AUTHORLINK NEWS/January 18, 2010–Troubled bookseller Borders Group, Inc. this week laid off 40 employees at headquarters and another five in its distribution centers for a total cut of 45 staff members. Borders CEO Michael Edwards is expected to make an announcement Wednesday.
In an e-mailed statement Borders said the decision to cut staff in nearly every department was in an effort to focus on reducing costs and readjusting its business model to improve profitability and cash flow.
Last week, Borders announced it will close its LaVergne, Tenn. warehouse this summer.
Top executives of Borders, which announced over the holiday weekend that it would suspend payments to publishers, began meeting with publishers in New York last week hoping to get them to sign off before the end of this month on a plan to refinance its debt. The plan proposes to exchange missed payments for notes, but publishers may be holding off to see if Borders will improve its offer. Borders has apparently located a new bank willing to finance its debt if publishers will accept the note offer by Borders.
In December, Borders reported a 17.6% third quarter loss in sales to $470.9 million, deepening its decline from last years 12.6% loss.
Earlier this month, two senior executives, chief information officer D. Scott Laverty and general counsel Thomas D. Carney, resigned from the company. Borders did not offer reasons for their departure.