Borders Gets Another Year

[David Hancock]

The biggest worry of the year for book publishers has been answered, as Borders appears to have been granted another 12 months to sort itself out. Leading shareholder and lender of last resort Pershing Square has extended their $42.5 million term loan to Borders until April 1, 2010.

But Pershing has once again won big concessions for that extension: The "put" option to buy the Paperchase chain (which Pershing never wanted to own in the first place) will expire, and the big grants of 14.7 million warrants will be reset from the previous price of $7 a share down to yesterday's stock price of just $0.65 per share.

CEO Ron Marshall, hand-picked by Pershing, says in the announcement, "The extension of the loan gives us some necessary breathing room, which is important in the current economic environment." Borders will announce fourth quarter earnings after the close of the market tomorrow.

[Ali Elizabeth Turner]

Hmmmm, perhaps it's time to go cheer up the employees and see if they at last want to do a book signing...

[Ron Finklestein]

Hi David,
I love reading. I love book stores. I was at the local borders yesterday a I left feeling depressed: lack of service, nothing was sorted, employees were less that happy to be there.
I wonder how much that is contributing to the demise?
Ron Finklestein
www.akris.net

[Suzann Rye]

Great news! Thanks for sharing:)

[Sherrie Rose]

David,

Thanks for this news update.

People have a tangible and emotional response to the physical expression of words - BOOKS.

So many of the small bookstores disappeared when the big chains came to town (remember the movie "You've Got Mail" with Fox Books?)

We need great bookstores!

Sherrie Rose
The Love Linguist
twitter.com/sherrierose

[Frank Garon]

Interesting news and thanks for passing this on. It'll be very interesting to see what happens over the next 12 months. I still don't see them making it, what are your thoughts, David?

Frank