Borders (Australia) go into administration
In what I’m sure must surely be a coincidence, the owner of Borders in Australia (and part owner of Kobo Books) has filed paperwork asking for the court to appoint an administrator. RedGroup Retail, the owner of Borders (AU), Whitcoulls, and Angus & Robertson, made this request after a board meeting today.
Under US law, the equivalent would be filing for bankruptcy protection, but it’s not quite the same in Australia.
In administration, someone other than the owners of RedGroup Retail will be making the decisions as they try to prevent the company from going all the way under.
This should not have come as a surprise. Redgroup have been having trouble since before July 2010. And in the long run, Redgroup might actually be in a worse position than Borders US. One unfortunate aspect of the Australian book market is that it is set up to price gouge the customer. This makes it significantly more likely that Australians will buy online, which means far less likely than Americans to buy from a local store.
Comments
fjtorres February 17, 2011 um 6:58 am
Again, this should have no impact on Kobo ebook owners over there but it is intriguing that two of Kobo’s regional partners are in such dire straights.
And they are looking for partners in the UK.
I suppose Waterstones would be the logical one as they too are headed for choppy waters.
(Seriously, are any large bookseller chains doing well in *any* competitive, i.e., non-protectionist/price fixing market?)
Darryl Adams February 17, 2011 um 6:00 pm
Ferrier Hodgson have been appointed as the Administrator.
Under the Corporations Act, it is ultimately up to the creditors what happens to the company. There are some options available to the Administrator, including something akin to US Chapter XI bankrupctcy protection (called a Deed of Company Arrangement here, but with a Deed Administrator apointed as well as the board having day to day control).
Borders and A&R are both in expensive areas (generally shopping centres like Westfields) so I doubt that the actually own their stores, unlike you may find in the states. Restructuring will proberbly mean more slash and burn as a result.
You’re not going to beleive the crap Borders are trying to pull with gift cards | The Digital Reader February 18, 2011 um 8:17 am
[…] (no relation to the US chain) went into administration (the Australian equivalent of bankruptcy) yesterday. Redgroup Retail then decided to go for double or nothing by pissing off the few customers they […]