Borders: Destined for the Remainders Bin
Bankrupt book retailer Borders Group is headed for liquidation after talks with buyout firm Najafi collapsed. The firm had planned to keep the second-largest bookstore chain in the U.S. in business. Negotiations fell apart because Najafi would not agree to demands from Borders’s creditors and landlords that it commit to maintaining a brick-and-mortar presence for the chain, which once operated more than 1,000 stores. Unless creditors win a reprieve in bankruptcy court, liquidators led by Hilco Merchant Resources and Gordon Brothers Retail Partners will wind down the remaining 399 Borders outlets by September.
American Airlines: Looks to Airbus to Update Fleet
American Airlines has committed to buying 460 jets in the industry’s biggest-ever order. The No. 3 U.S. carrier is purchasing 260 Airbus planes and 200 Boeing 737s, with options for 465 more. American now flies an all-Boeing fleet and hasn’t bought any jets from Airbus since 1987. The Texas-based air carrier has been saddled with aging planes: Its jets averaged 15 years of service last year. The new order will help American reach its goal of having the most fuel-efficent fleet in the nation within five years.
Goldman Sachs: The Pay Pool Shrinks
Goldman Sachs set aside $8.4 billion for employee compensation in the first six months of 2011, 9 percent less than in the same period last year. That’s enough to provide $237,662 in salaries, bonuses, and benefits to each employee, compared with $272,581 a year ago. The bank will shrink its 35,500 headcount by 1,000 this year as part of a $1.2 billion cost-cutting plan. The savings are meant to offset a drop in revenue from trading debt, currencies, and commodities—traditionally its main moneymaker.
Warner Bros.: Final Harry Potter Film Sets Records
Harry Potter and the Deathly Hallows—Part 2, the final movie in the series based on the best-selling books by J.K. Rowling, opened with $169.2 million in ticket sales in the U.S. and Canada—beating the weekend record set in 2009 by The Dark Knight. Warner Bros. may collect as much as $400 million in U.S. ticket sales from the final Harry Potter pic, positioning it to overtake Paramount Pictures in the race for the 2011 box office crown. The series has generated more than $6.85 billion for Warner at box offices worldwide.
Apple: No New iPhone, No Problem
Apple sold 20.3 million iPhones and 9.3 million iPads in the third quarter, the most ever for the company. Strong demand for the two products powered an 82 percent surge in revenue over last year, to $28.6 billion. It was the first time since 2008 that Apple’s third-quarter results didn’t include the release of a new iPhone, its best-selling product. Apple also won a patent dispute with HTC over technology in the Taiwanese company’s mobile devices, many of which use Google’s Android operating system.