Borders Group has agreed to sell its U.K. stores to Risk Capital Partners, a London-based private equity firm with other holdings in the retail segment, although no other bookstore properties. Risk Capital has agreed to pay £10 million ($20 million) for the 41 Borders superstores and 28 Books etc. locations as well as the right to continue to use the Borders name. In addition, Risk could pay as much as another £10 million depending on the performance of the stores, and Borders will receive a 17% equity stake in Bookshop Acquisition Ltd., the new company formed to house the Borders operation.
David Roche, head of Borders U.K., will continue to run the business, which has outlets across the U.K. and Ireland. The entire British bookstore segment as been mired in a sales slump for more than a year, and this winter new Borders CEO, George Jones, announced his intention of divesting most of Borders’s international operations. The deal does not include Borders’s Paperchase stationery operation, which includes shops within existing Borders stores in the U.K. and U.S. The Borders Group will retain worldwide ownership of the franchise. The sale also does not include Borders’s Asia Pacific group, which has 20 superstores in Australia and four in New Zealand. A deal for that group is reported to be close.
