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June 13 – June 19, 2011 Edition Borders Reduces Potential Store Closing List, Gets New Hearing
NEW YORK, NY/AUTHORLINK NEWS/June 13, 2011–Borders Group, Inc. on Friday asked the U.S. Bankruptcy Court in New York for an earlier hearing date on which to decide how the bookstore chain will conduct its store closing sales at locations where its lease extensions have not been worked out with landlords. The retailer filed for reorganization last February.
Judge Glenn, the Southern District presiding judge, granted the motion and set the hearing date to June 20, 2011.
Meanwhile, Borders apparently is nearing lease extensions for at least six more of its stores, meaning the list of stores threatened with closing will drop from 51 to 45 locations–if the court grants more time to negotiate new leases.
Stores where extensions have been reached include four airport locations–two in the Detroit Airport, one in Bostons Logan Airport and a fourth at the Raleigh Durham Airport. Stores in Westland, Mich. and Williamantic, Conn. have also been moved off the list.
In February the court approved its $505 million in Debtor-in-Possession (DIP) financing led by GE Capital, Restructuring Finance. Borders DIP financing depends upon the company securing court approval by June 22 to hold store closing sales. The June 20 hearing will allow it to meet that obligation and to get approval for procedures to select a liquidator. Objections to the motion must be filed by June 16.
The DIP financing allows Borders to pay vendors, publishers and other suppliers for post-petition goods and services and to operate its day-to-day business.
In its Friday motion, Borders noted that it has requested a waiver to liquidate stores with which it does not have an extension agreement pending the proposed scheduling of a hearing to consider the sale of the entire business on or about July 21.
