Borders files for bankruptcy

borders launches kobo powered ebook store logo

Book retailer Borders has filed for Chapter 11 bankruptcy protection and plans to close as many as 30 percent of its “underperforming” stores in the next several weeks—which adds up to about 200 retail locations. Borders says it has acquired over $500 million of “debtor-in-possession” financing led by GE Capital to help the company restructure its business into a viable long-term venture…but, in the meantime, the company says it has assets of about $1.3 billion along with about the equivalent amount of debt.

“Borders Group does not have the capital resources it needs to be a viable competitor and which are essential for it to move forward with its business strategy to reposition itself successfully for the long term,” said Borders Group president Mike Edwards, in a statement. “This decisive action will give Borders the opportunity to achieve a proper infusion of capital in order to have the opportunity to have the time to reorganize in order to reposition itself to be a successful business.”

Borders has been struggling for some time, and the move has been widely anticipated in the publishing and bookselling industries. At the heard of Borders’ financial woes are debts owed to publishers, with the Wall Street Journal reporting (subscription required) that the company’s five largest unsecured creditors are all major publishers, including Penguin Putman, Hachette, Simon & Schuster, Random House, and HarperCollins. The bankruptcy declaration enables Borders to dodge a significant amount of that debt as they compete with other creditors for repayment from the company, and likely see sales through Borders decline as the company shutters stores. The company says it expects to continue being able to make salary and benefits payments for its employees, and all gift cards and other customer programs will be honored.

Borders says it will continue operations as normal, but will be implementing a Strategic Store Reduction Program that will see about 30 percent of its retail locations closed in the next several weeks. Borders says it intends to close “underperforming” locations—and a 30 percent reduction equates to about 200 stores. Remaining stores will continue operating as normal, as will Borders.com.

Over the years, pundits have been predicting the end of the traditional bookstore, first due to competition from the likes of Amazon.com, which has succeeded in driving many mom-and-pop and local bookstores into the ground through the convenience of online ordering and prices small booksellers just can’t match. More recently, booksellers have been threatened as readers increasingly turn to ebooks, enabled by the likes of the Amazon Kindle, Barnes & Noble Nook, Apple iPad, and Sony Reader. Borders’ bankruptcy is another indication of the shifts in the broader publishing word: now, not even megastores are immune from the economic realities of book retailing.

Emerging Tech

Geoengineering is risky and unproven, but soon it might be necessary

Geoengineering is a field dedicated to purposely changing the world's climate using technology. Call it 'playing god' if you must; here's why its proponents believe it absolutely must happen.
Emerging Tech

Climeworks wants to clean the atmosphere with a fleet of truck-sized vacuums

Using machines that resemble jet engines, Climeworks wants to fight climate change by extracting CO2 from thin air. The gas can then be sold to carbonated drink and agriculture companies, or sequestered underground.
Emerging Tech

Burgers are just the beginning: Embracing the future of lab-grown everything

You’ve almost certainly heard of the 'farm to fork' movement, but what about 'lab to table'? Welcome to the fast-evolving world of lab-grown meat. Is this the future of food as we know it?
Gaming

Transform into the ultimate leader with our tips and tricks for Civilization 6

Civilization VI offers both series veterans and total newcomers a lot to chew on from the get-go. Here are some essential starting tips to help you master the game's many intricacies.
Emerging Tech

Beresheet crash caused by manual command, but reflector device may have survived

Details are emerging about what may have gone wrong with spacecraft Beresheet's failed moon landing. A manual command was entered which led to a chain reaction. But NASA still hopes to salvage use of its Laser Retroreflector Array device.
Emerging Tech

The oldest type of molecule in the universe has been located at last

A milestone in the development of the early universe was the combination of helium and hydrogen atoms into a molecule called helium hydride. But strangely enough, this ancient molecule has never been detected in space before now.
Emerging Tech

The grid of the future will be powered by … giant subterranean bagpipes?

In order to transition to a more renewable-focused energy system, we need to scale up our grid storage capacity --- and our existing methods aren't going to cut it. Could compressed air be the key?
Emerging Tech

Mercury’s wobble as it spins reveals that it has an inner solid core

Scientists have long wondered what the inside of Mercury looks like, and they now have strong evidence that the planet has a large and solid metallic core. The data for the new findings was collected by the now-defunct MESSENGER mission.
Emerging Tech

Gravitational forces at heart of Milky Way shaped this star cluster like a comet

Hubble has captured the stunning Messier 62 cluster. The cluster is warped, with a long tail which stretches out to form a shape like a comet. It is thought this distortion is due to Messier 62's proximity to the center of the galaxy.
Emerging Tech

Troubleshooting Earth

It’s no secret that humans are killing the planet. Some say it’s actually so bad that we’re hurtling toward a sixth major extinction event -- one which we ourselves are causing. But can technology help us undo the damage we’ve…
Emerging Tech

Inside the Ocean Cleanup’s ambitious plan to rid the ocean of plastic waste

In 2013, Boyan Slat crowdfunded $2.2 million to fund the Ocean Cleanup, a nonprofit organization that builds big, floating trash collectors and sets them out to sea, where they’re designed to autonomously gobble up garbage.
Emerging Tech

How 3D printing has changed the world of prosthetic limbs forever

When he was 13 years old, Christophe Debard had his leg amputated. Here in 2019, Debard's Print My Leg startup helps others to create 3D-printed prostheses. Welcome to a growing revolution!
Digital Trends Live

Digital Trends Live: Earth Day, indoor container farming, robot submarines

Today on Digital Trends Live, we discuss how technology intersects with Earth Day, a new Tim Cook biography, indoor container farming, robot spy submarines, A.I. death metal, and more.
Gaming

Google’s Stadia is the future of gaming, and that’s bad news for our planet

Google’s upcoming Stadia cloud gaming service, and its competitors, are ready to change the way gamers play, but in doing so they may kick off a new wave of data center growth – with unfortunate consequences for the environment.