LeBow Invests In Borders (BGP)

Financier Bennett LeBow has bought 11.1 million shares of Borders Group Inc. BGP for $25 million. The purchase has made LeBow the biggest shareholder of the company, dethroning Bill Ackman. Ackman, through his firm Pershing Square Capital Management, holds a 17.7% stake in the struggling bookselling company. LeBow will also join Border’s (BGP) board. The company has said that the new funds will be used to augment the company’s capital position and for entering the electronic books market. Borders had recently repaid a $42.5 million loan to Pershing Square. In an interview with Reuters, Bill Ackman had recently questioned whether there was room for two national specialty bookstore chains in the United States. Reuters has reported that Borders will need the approval of its shareholders to issue LeBow warrants that would enable him to acquire an additional 35.1 million shares at $2.25 apiece.