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Borders US has been granted more "breathing room" by its leading shareholder Pershing Square. Pershing has agreed to a one-year extension of its $42.5m loan to the company, which will now expires on 1st April 2010. It is the third time it has extended the agreement, and will be a huge relief for US publishers as concerns grow over the future of America's second biggest book chain.
As part of the deal Borders US will retain Paperchase, with the 'put' option agreed to by Pershing, which would have obliged it to buy the business, having been waived.
Chief executive Ron Marshall, put in to run Borders by Pershing, said: "The extension of the loan gives us some necessary breathing room, which is important in the current economic environment."
The deals were part of refinancing agreement put in place by Borders US in March last year.