The Borders Group, a 40-year-old major book merchant, announced Monday that it will be closing down its leftover 399 shops permanently. The business had been in bankruptcy, but hoped a buyer would step in and conserve them at the eleventh hour. But no savior showed up. Borders had almost 11,000 staff across the United States. Those individuals may need personal loans to cover their bills now.

Bankruptcy auction ended

Borders terminated a bankruptcy-court auction that was set for today. The plan is for Borders to ask for a sale to be accepted on Thursday. This sale would be to Hilco Merchant Resources and Gordon Brothers Group liquidators.

Company president

Mike Edwards, president of the company, said:

"Following the best efforts of all parties, we are saddened by this development. The headwinds we have been facing for quite some time -- including the rapidly changing book industry, eReader revolution and turbulent economy -- have brought us to where we are now."

Sold used books for some time

In 1971, Borders was started in Ann Arbor, Michigan. It was a used book store. It became the nation's second largest bookseller after struggling with the tough economy for many years. In February, after finding tough competition from electronic books and discount outlets, Borders filed for bankruptcy. It has been very difficult for the company to get publishers to send in books now as it has limped along.

Negotiations promising for a time

Things looked more hopeful earlier this year when private-equity investor Jahm Najafi was negotiating the purchase of the company for $215.1 million. Since Najafi would have been able to liquidate without creditor obligations, the plan was rejected by Borders' largest unsecured creditors.

E-readers shove books out

The demise of Borders could herald the collapse of the book publishing industry as consumers increasingly turn to electronic media rather than to the printed page.

"It saddens me tremendously because it was a wonderful chain of bookstores that sold our books very well," said Morgan Entrekin, president of Grove/Atlantic Publishers. "It's part of the whole change that we're dealing with, which is very confusing."

Borders claims the liquidation could start as early as Friday and should be completed by the end of Sept.

Articles cited

Daily Finance,

Yahoo! Finance,

Wall Street Journal