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Digital News Report – The Borders book retailer has filed a Chapter 11 Bankruptcy protection in order to reorganize. The company also announced today that they have also received commitments for $505 million in Debtor-in-Possession (DIP) financing coming mostly from GE Captial, Restructuring Finance.
Borders will continue to honor Borders Rewards program and gift cards to its customers. Employees will also continue to be paid as expected with payroll and benefits. However, Borders did announce that they will be closing around 30 percent of their retail stores during the restructuring process. These were under-performing stores that the company has pinpointed and will be closing them in the next several weeks.
Borders did file the Chapter 11 petition, but is waiting for the approval of the U.S. Bankruptcy Court, Southern District of New York along with other conditions are met with the lenders are providing the financing. Borders has a website at www.bordersreorganization.com to follow updates on the progress of these Bankruptcy reorganization proceedings.