NEW YORK — Barnes & Noble Inc. appears to be getting more serious about buying chief rival Borders Group Inc., confirming Thursday that it put together a management team to study the “feasibility” of a combination.
The disclosure came as the nation’s largest bookseller reported a wider loss in the first quarter on a tax-related charge and lowered its sales guidance for the year.
Speculation had been mounting about a possible Barnes & Noble-Borders combination since Borders announced in March that it was putting itself up for sale and that it had lined up $42.5 million in financing to help it continue operations. At that time, Barnes & Noble said it would take a look at its rival.
Borders issued a statement Thursday saying that the company is “in the midst of the strategic alternatives process and has not engaged in substantive discussions regarding any specific transaction to date.”
Booksellers are facing fierce competition from discounters including Wal-Mart Stores Inc., which has been aggressive about price-cutting.
Barnes & Noble officials declined to elaborate further regarding its review of Borders. But industry analysts say that a potential combination of Borders and Barnes & Noble would face numerous obstacles, from the challenge of paring back a long list of overlapping stores to antitrust concerns from federal regulators.
New York-based Barnes & Noble said it lost $2.22 million, or 4 cents per share, in the quarter ended May 3. That compares with a loss of $1.67 million, or 3 cents per share, in the year-ago period.
