Carly Z has written quite a bit about ailing Borders, including a recent look at why Barnes & Noble shouldn’t buy them. Turns out she was prophetic, as a DailyFinance article today listed them as one of the 10 most likely companies to disappear in 2011. Here are their thoughts:
The large bookstore chain is almost gone already. The only question remaining is whether it will be dissolved or sold to a related retailer like Barnes & Noble. It appears Borders has little choice other than to go bankrupt, given its debt and cash-flow situation. Two ominous signs for the bookseller: It says it’s unable to pay some of its largest publishers for their books.
Border’s stock also dropped under $1 a share, a warning sign that the shares could eventually be delisted — that is, if Borders lasts long enough. The company’s 500 locations may have value to a buyer, but its name does not, being associated with little more than failure.
So unless Barnes & Noble can get a really sweet deal on the assets, particularly the locations, there is little reason for them to buy Borders before they end up in liquidation later this year. Pretty much like Carly said!