Tuesday, July 13, 2010

Borders to sell Paperchase unit!

THE DEAL: Bookseller Borders Group Inc. is selling its Paperchase Products Ltd. stationery unit for $31 million, to pay down debt.

THE BIG PICTURE: Borders has been struggling as it faces falling demand and increasing competition from discounters and online book sellers. Financier Bennett LeBow invested $25 million in the retailer in May, becoming the company's largest shareholder, chairman and CEO.

REACTION: Shares rose 8 percent. But S&P analyst Michael Souers said although he favors the deal, "we continue to have a negative outlook on the book retailing industry."



(AP)

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