Borders is considering selling Paperchase, its upmarket stationery chain, in response to troubled times on the High Street.
JPMorgan and Merrill Lynch were appointed earlier on this year to conduct a strategic review of Borders' assets, including Paperchase. The administrators are to conduct the sale process as well. Paperchase may sell for up to £80m.
Borders is currently considering selling the stationary chain to one of three bidders, HgCapital, Isis Equity Partners and Change Capital. WH Smith's chief executive, Kate Swann, is also considering putting in a £50m bid for Paperchase.
It is believed that a deal close to £80m can only be achieved if financing on good terms is available from risk-averse lenders. Though Paperchase' sale tag seems to be high, it is profitable. In the year to February 2007, Paperchase made pre-tax profit of £6.2m on turnover of £47.1m.
It is understood that no formal bids have yet been submitted as part of the review.
The stationary chain was established 30 years ago as an art supply shop in Kensington. Paperchase has more than 100 stores across the UK, including concessions at Selfridges and House of Fraser stores.
