Borders buys Paperchase

Book retailer Borders today unveiled a £18.6m (€28m) deal to take control of stationery-to-greeting cards seller Paperchase.

US-based Borders, which also sells music and films, increased its holding in the company from 15% to 97% through the agreement with Graphite Capital.

The private equity group, which also owns noodle bar chain Wagamama, fashion retailer Jane Norman and Maplin Electronics, bought the holding when it backed a management buy-out of the business from WH Smith in 1996.

Since then annual sales have more than trebled to £27.4m (€41.3m) and the number of stores has risen from 12 to its current total.

Paperchase employs 500 nearly people across 61 sites, including stand-alone stores in locations such as London’s Covent Garden and 4 concessions in House of Fraser, Selfridges, Borders and Books etc.

The group will retain its current management team and will continue its UK growth strategy, with new stores due to open in Milton Keynes, Brighton and London’s Kings Road.

Chief executive Timothy Melgund said he was confident the acquisition by Borders would provide a “critical opportunity” for the company to grow.

Borders sells its products from sites including 450 stores in the United States and 37 international outlets – mainly in the UK and the Pacific Rim. It employs 32,000 people worldwide and has annual revenues of $3.7bn (€3bn).

The majority of gifts and stationery items available at its Borders’ UK and Singapore stores are provided by Paperchase.