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Publishers in the dark over Borders' future as payment deadline passes
25.11.09 | Catherine Neilan and Caroline Horn
Publishers are waiting for news on Borders, as negotiations continue over a possible sale of the troubled chain. A number of distributors have the retailer on stop, with the Random House-owned companies--The Book Service and Grantham Book Services--"still awaiting confirmation of when a payment will be made" after last week's deadline passed. The FT today (25th) reports that "one person close to the company" said management was likely to appoint administrators before the end of the week.
Publishers distributed by TBS/GBS said "no money, or even a proposal of payment had emerged" from the chain since last week when the Random House-owned companies gave the chain until Friday (20th November) to provide "a payment figure". Yesterday the chain was forced to cancel a signing for the Ebury published Justin Lee Collins title Good Times due to "unforeseen events".
According to an email sent by the distributor, it has now begun the process of placing back on its shelves books that had been ordered by Borders UK: "Due to a number of our client publisher’s requests, we will be commencing the exercise of crediting and placing back to stock the previously picked but not despatched order from last week; we aim to have completed this exercise by this Friday evening (27th). We are also continuing to credit authorised returns received at our Manningtree returns warehouse."
Publishers told The Bookseller they were in the dark over the future of the business, while Borders' new PR Financial Dynamics is continuing to offer a "no comment" to media inquiries.
Children's publishers were particularly concerned about the potential loss from the high street of the chain that has picked up The Bookseller's Retail Award for children's bookselling for three consecutive years. Scholastic sales director Hilary Murray-Hill said: "The potential loss of any customer is always going to be of concern and the loss of a high street customer is of particular concern. We have enjoyed good support from Borders across all of our list." But independent publisher Piccadilly Press, m.d. Brenda Gardner said: "We had been struggling with Borders, including lots of returns and the changes in their children’s buyers."
According to the FT, the person close to the company said that if Borders was placed in administration some stores would close immediately, while others would carry on for a few weeks to run off stock or to try to find a buyer. It also reported that Waterstone's parent HMV was still in discussions as of yesterday (24th) though was only interested in a small number of stores.
Borders UK has been the subject of speculation since last week when its adviser Clearwater placed a 'for sale' ad in the Financial Times. Retail Week reported that WH Smith had walked away from a deal. It also emerged that TBS/GBS cut off supply last week, following Borders UK's decision to stop a cheque payment, claiming that it had "overpaid" the distributors "by not netting off returns deductions from their payment". Hachette-owned Littlehampton Book Services joined those distributors to have temporarily stopped trading with the bookseller yesterday (Monday 22nd November). Gardners is also understood to have put a stop on the company, meaning it can no longer supply books from its website.