By: Kara Gilmour
Feb 2, 2021
Borders bankruptcy likely despite rising stock. Borders stock prices are soaring even though bankruptcy may be looming for the company. The stocks rose significantly when major investor Bill Ackman stated that filing a red Chapter status was a “low-probability event.”
Investors who fear the worse have been talking about a possible bankruptcy for Borders. It’s been going on for about a year. However, the company’s stock price rose 37 percent after Ackman’s statement was made on CNBC.
The declaration from the major investor was also a surprise to many who have believed that the bookstore chain has been heading towards bankruptcy. Just days earlier, the Wall Street Journal notes, Borders announced a major series of layoffs, just the most recent in a particularly bad year for the company.
In addition, Borders CEO Ron Marshall resigned, after working with the company for only one year. Marshall’s resignation led many to wonder if the company was headed towards bankruptcy. Stock shares have been lower than ever over the past year, and the bookstore had a “disappointing” holiday season, according to Marshall.
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