Borders to end cafe pact with Seattle's Best

By @ibtimes on

Bankrupt bookstore chain Borders Group Inc said it planned to end its relationship with Seattle's Best Coffee and begin operating its own in-store cafes.

Seattle's Best cafes, part of Starbucks Corp , had been a staple of nearly all of Borders' more than 400 superstores since the parties signed a licensing agreement in 2004.

The move will allow Borders to reduce licensing fees as it works toward emerging from bankruptcy, a spokeswoman said on Thursday.

Borders which helped pioneer the concept of book superstores, filed for bankruptcy protection in February after years of falling sales that made it impossible to manage its debt load. Last week, a person close to the matter said the bookseller had received indications of third-party interest for its business that could keep it running as a going concern.

The company said in a filing in U.S. Bankruptcy Court in Manhattan that it will seek the court's approval of the move to reject its leases with Seattle's Best.

Running its own cafes will allow Borders to tailor its menus to customer needs, the Borders spokeswoman said.

A spokeswoman for Seattle's Best Coffee was not immediately available for comment.

The case is In re Borders Group Inc, U.S. Bankruptcy Court, Southern District of New York, No. 11-10614.

(Reporting by Nick Brown; Editing by Lisa Von Ahn and Tim Dobbyn)

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