A&R Whitcoulls has surprised the industry by pulling out of its bid to buy the Borders bookstore chains in Australia and New Zealand. Its move opens the field up to a fresh round of bidding though Whitcoulls seems to have left the door ajar by saying it “remains open to considering” a further bid.
Meanwhile, it is likely that Paper Plus will dust off its Borders file and look at the purchase again. Paper Plus, as a co-op, might have an advantage in not having to clear the same regulatory hurdles with the competition commissions that complicated the A&R Whitcoulls’ bid. But there is some doubt about whether it would be as simple as that.
It’s not clear why the bid failed, after clearing regulatory hurdles both here and in Australia, but the A&R Whitcoulls statement indicated the deal might have fallen over on price or the structure of the deal with Whitcoulls’ cash-and-shares offer not meeting the seller’s expectations.
Given the £10-20 million price tag on the purchase of Borders’ 70-store UK chain back in September, the A$100 million figure talked about for the Downunder stores might have been a bit rich. If the UK buyer, private equity firm Risk Capital Partners, is happy with its purchase, perhaps we’ll see them taking a look at the stores in this part of the world now.