Layoffs in the United states continued as big companies looking for cost cutting or shutting down its operations. Cisco Inc and Borders Group today announced another round of layoffs.
Borders Group, the second largest book store chain announced that it will shuts down all its stores as company was unable to find a buyer and it will sell itself to a group of liquidators led by Hilco Merchant Resources.
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| Borders Group Inc |
Borders was unable to overcome competition from larger rival Barnes & Noble and from Amazon.com, which began to dominate book retail when the industry shifted largely online.
Borders, which declared bankruptcy in February, also never caught up to its rivals' e-reader sales, namely Amazon's Kindle and Barnes & Noble's Nook.
Borders had hoped to sell itself to buyout firm Najafi Cos, which owns the Book-of-the-Month Club.
While Najafi was willing to pay $435 million for the assets, the deal fell apart last week after creditors objected to terms that would have allowed Najafi to liquidate after completing the sale.
Earlier Monday, Reuters reported that Books-A-Million, the nation's third-largest bookstore chain, was in talks to acquire a small number of Borders stores, citing sources close to Borders' bankruptcy.
Representatives for Borders did not address the report when contacted by Reuters, and the company's statement did not say whether formal talks had taken place.
The Hilco group will begin liquidations as early as Friday, with the process to conclude sometime in September, Borders said.
The bookseller will seek bankruptcy court approval of the closing procedures at a hearing Thursday in U.S. bankruptcy court in Manhattan.
Andrew Glenn, an attorney for Borders, told Reuters last week the company expected a liquidation sale to bring in between $250 million and $284 million.
Cisco Systems plans to cut its workforce by 11,500 employees as part of its plan to cut annual expenses by $1 billion and revive its business.
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| Cisco Systems |
The company also plans to sell its manufacturing facility in Juarez, Mexico, to Foxconn and transfer 5,000 employees to the contract manufacturing company as part of the deal.
Analysts had predicted thousands of job cuts after Cisco said in May that it planned to reorganize the company which has been losing ground in the network equipment business.
The company announced more cuts than some analysts expected.
The job cuts will result in pre-tax restructuring charges "not expected to exceed $1.3 billion over several quarters," the company said.
( Source: Reuters )
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