TVNZ are reporting:
REDgroup Retail, operator of bookstore chains Whitcoulls and Borders, is talking to its financiers in a bid to get a waiver from an expected breach of banking covenants in August.
The company said that following consideration of its most recent management accounts, the board has formed the view that the company is likely to breach two out of three of its banking covenants when they are tested on August 28.
So what's the ebook angle? REDgroup are one of the corporate investors in Kobo as well as the partner for the Australian and New Zealand markets. They're now the second Kobo investor (along with Borders US) who can't afford to invest more money in Kobo, which means Kobo don't have a safety net.