Bookstore to close as parent company downsizes

Sat. November 07, 2009; Posted: 06:36 PM

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FARMINGTON, Nov 07, 2009 (The Daily Times - McClatchy-Tribune Information Services via COMTEX) -- BGP | Quote | Chart | News | PowerRating -- Waldenbooks in the Animas Valley Mall will close its doors in January 2010. The announcement came from the bookseller's parent company, Borders Group, which is downsizing its holdings by closing 200 stores nationwide.

The stores that are closing were selected on a "location-by-location basis," said Mary Davis, spokesman for Borders. She would not comment on why the Farmington store was selected, but she did confirm that the employees were made aware Thursday of the pending closure.

"Overall this is cutting 1,500 jobs nationwide, the majority of which are part-time," she said.

Borders Group, based in Ann Arbor, Mich., referred to the closures as "right-sizing" the company "to emerge with a significantly smaller Walden mall business that complements our Borders Superstore business," Davis said.

The "mall-based right-sizing initiative" began in 2001. Through 2008, Borders closed under-performing Waldenbooks Specialty Retail. It will leave about 130 mall-based locations open, as agreements are made over the coming weeks, a press release from Borders stated.

Davis, however, said the list only would grow from there, and that Farmington's store is destined for closure.

"America has a number of malls that continue to do well and draw customer traffic even in the current economy," said Borders Group Chief Executive Officer Ron Marshall in the press release. "We believe there remains an opportunity to profitably operate a much smaller Waldenbooks

segment that complements our core Borders superstore business and continues to serve readers in their communities. Through this right-sizing, we will reduce the number of stores with operating losses, reduce our overall rent expense and lease-adjusted leverage and generate cash flow through sales and working capital reductions."

The closures will reduce the company's rent and employee expenses, Davis stated.

Animas Valley Mall Manager Jeff Ring was unavailable for comment Friday, and store employees could not comment on the status of the store's closing. Those employees are eligible for severance packages from the company, according to Davis.

Borders will retain 500 of its calendar-sales kiosks in malls across the country.

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For full details on Borders Group Inc (BGP) click here. Borders Group Inc (BGP) has Short Term PowerRatings of 3. Details on Borders Group Inc (BGP) Short Term PowerRatings is available at This Link.

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