Judge OKs Borders closings, gift card program

By Mae Anderson Associated Press NEW YORK (AP) -- A judge last Thursday approved Borders Group Inc.'s plan to close 200 stores as part of its attempt to attempt to fix its business in bankruptcy protection. The ruling follows approval last Wednesday for using $400 million of the $505 million in financing to pay vendors and keep its business going, including honoring its loyalty program and gift cards. The decisions are the start of a lengthy and difficult process for Borders, which filed for bankruptcy protection last Wednesday. The No. 2 U.S. bookseller is attempting to reorganize so it can emerge from bankruptcy protection a smaller and profitable company. Store clearance sales are expected to begin this weekend, Borders said. Chief Judge Arthur Gonzalez of the Southern District U.S. Bankruptcy Court in New York ruled on the store closings. In a filing CFO Scott Henry said Borders might try to close as many as 75 more stores. Henry's document revealed just how precipitously Borders' revenue declined in 2010, down 18 percent to $2.3 billion, from $2.79 billion in 2009. He said the company's strategy includes enhancing its loyalty program, aggressively expanding Borders.com and its e-book market share, offering more non-book items, cut costs and improve its customer service. A hearing to grant final approval of Borders' bankruptcy financing will be held March 15. Published: Mon, Feb 21, 2011