After a 53-year run, Tattered Cover may not be an independent bookstore much longer.
The beloved Denver company could soon be sold to Barnes & Noble, which made the top initial bid ahead of Monday’s bid deadline, according to a source familiar with the process.
No bid has been approved and Barnes & Noble could still lose out or back out. But if approved by the company’s board of directors and a U.S. Bankruptcy Court judge, the sale is sure to send shockwaves through the nation’s publishing and book-selling industries.
Tattered Cover has survived, though barely at times, as other independent bookstores have crumbled and consolidated, earning it respect across the country. A sale to Barnes & Noble would likely plant it on firmer financial ground while also ending its independence.
Tattered Cover opened in Cherry Creek in 1971, three years before it was bought by its best-known owner, Joyce Meskis. She turned it into an institution, a community gathering place and a bastion of First Amendment advocacy before selling it in the mid-2010s.
Len Vlahos and his wife Kristen Gilligan came to control it in 2017, then sold it in 2020 to its current ownership group, who run it as Bended Page LLC. That LLC filed for bankruptcy last October after years of big losses. A sale would likely end that bankruptcy.
The company was scheduled to be auctioned off Wednesday but Tattered Cover canceled that auction midday Tuesday. Doing so “supports the company’s strategic direction toward achieving the best possible outcome for the future of Tattered Cover,” a spokesman said.
The company still has the option of conducting an auction at a later date if it wishes.
“At this time the board, management and corporate counsel are all actively engaged in ongoing discussions and negotiations with the qualified bidders,” said the spokesman, Steven Silvers. “We don’t know how long these will continue or when we’ll have more information.”
He declined to name the bidders or say how many there are, citing confidentiality clauses.
“All parties are taking this process very seriously and discussions have been positive,” Silvers explained in his statement. “We remain quite hopeful that Tattered Cover is going to secure new ownership that believes in its mission and values.”
Eight people or companies expressed enough interest in Tattered Cover by mid-May that they were willing to sign non-disclosure agreements in exchange for a look at the company’s books. At that time, a June 10 bid deadline and June 12 auction date were set.
Tattered Cover had opted not to use a broker or marketing firm to advertise its assets.
“The bankruptcy case and proposed sale process have been extensively covered in the media and publishing world. Given the interest generated by that coverage, (we) did not believe that a broker/marketer would likely reach a wider audience,” its lawyers wrote in May.
Tattered Cover revealed then that it lost about $10,000 in March, a stark improvement over prior months and far better than the $100,000 deficit it was anticipating. Last week, the company reported losses of $53,000 for April, which is about what it was expecting to lose.
Tattered Cover has reported losses of $517,000 since filing for bankruptcy in October. It has borrowed $700,000 from an LLC created by local philanthropists to remain afloat.
This story was reported by our partner BusinessDen.
