Borders Group Reaches Deal to Sell Paperchase
Posted on July 13, 2010Borders Group has entered into an agreement to sell Paperchase Products Limited to Primary Capital Limited, a private equity firm. Paperchase is a retailer of stationery, cards and gifts based in the U.K. Most Borders stores nationwide feature Paperchase gifts and stationery products. Under the agreement, Borders Group will continue to purchase and carry products designed and sourced by Paperchase in its U.S. stores.
The company will receive proceeds of approximately $31 million upon closing, which is expected within the next week. The company is required to use $25 million of the proceeds to reduce the amount outstanding under its $90 million term loan credit facility.
"The sale of our Paperchase business is another major step in strengthening our balance sheet - and enables us to place an even greater focus on our financial and strategic initiatives, which are vital to a Borders turnaround and revitalization of the brand," said Mike Edwards, President of Borders Group, Inc. "We look forward to continuing our strong relationship with the Paperchase team to provide our customers with the wide array of fashionable gift and stationery products they've come to expect from Borders."