Friday 18th February 2011 2 Comments
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There will be grave consequences for the book industry if two large chains begin closing their stores, the chief executive of Booksellers New Zealand says.
Borders and Whitcoulls were put under administration in Australia and New Zealand yesterday.
Australian parent company REDgroup Retail, which manages operations in both countries called in voluntary administrators to the business.
"It's to do with the financial structure as opposed to anything fundamentally wrong with the book industry," Mr Gould said.
Borders and Whitcoulls made up 85 of the 350 bookshops in New Zealand and so were an important part of the industry.
"We just hope they don't start closing doors, it would be an impact for publishers, consumers and it would be very sad. There are obviously hundreds of other bookshops, it would not be a terminal problem for the book industry but it would be of grave consequence," Gould told Radio New Zealand.
REDGroup is controlled by private equity group PEP.
Ferrier Hodgson partners have been appointed voluntary administrators of the group.
Partner Steve Sherman said as far as possible it would be business as usual while the administrators conducted an urgent assessment of the business's financial status, according to a statement.
The separate US-owned Borders chain also collapsed this week but is not linked to the Australasian chain.
New Zealand's Whitcoulls chain comprises of 65 stores, 40 of which are located in Auckland, Wellington and Christchurch, according to its website.
It was first established as Whitcombe and Tombs in 1888 and Coulls Somerville Wilkie in 1871.
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