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In the near term the news is probably good for rival Barnes & Noble, but the brick-and-mortal bookstore business has been declining for years.

Borders Files for Bankruptcy; 200 Stores to Close

As expected, Borders, one of the U.S.’s only two nationwide bookstore chains, filed for Chapter 11 bankruptcy today. It plans to close about 200 stores (roughly 30% of the total), including almost half its 30 Chicago-area stores and three of its five Manhattan locations. Borders, which employs about 6,100 full-time workers, owes the six largest book publishers combined about $182 million; one publisher told the Wall Street Journal, “If publishers are lucky, they’ll get back 25 cents on the dollar.”

However, the company has received a promise of over $500 million in reorganization financing from a group led by GE Capital, to give it breathing room to restructure.

In the near term the news is probably good for rival Barnes & Noble, which may take over some Borders stock and locations. But the brick-and-mortal bookstore business has been declining for years.

Barnes & Noble has been trying out new marketing strategies in an effort to stave off Borders’ fate, such as a gift card deal with Groupon, and its new Nook Color e-reader has been receiving some positive reviews. Still, many industry observers predict a continuing steep decline in the large-scale bookstore business.

About Jon Sobel

Jon Sobel is a Publisher and Executive Editor of Blogcritics as well as lead editor of the Culture & Society section. As a writer he contributes most often to Culture, where he reviews NYC theater; he also covers interesting music releases. Through Oren Hope Marketing and Copywriting at http://www.orenhope.com/ you can hire him to write or edit whatever marketing or journalistic materials your heart desires. Jon also writes the blog Park Odyssey at http://parkodyssey.blogspot.com/ where he visits every park in New York City. And by night he's a part-time working musician: lead singer, songwriter, and bass player for Whisperado, a member of other bands as well, and a sideman.

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