Financier invests in Borders, becomes chairman

ANN ARBOR, Mich. (AP) - Borders Group says financier Bennett LeBow is investing $25 million in the company and will become chairman.

The nation's No. 2 traditional book seller says LeBow, chairman of holding company Vector Group Ltd., is buying 11.1 million shares at $2.25 apiece, which will be used to help strengthen its balance sheet and grow its online efforts.

Borders has been trying to expand its eBook store in an effort to boost sales. It has cut jobs, closed stores and reduced spending to improve profitability and offset increasing competition from discounters and online retailers like Amazon.com.

Majority shareholder Pershing Square Capital Management LP has expressed its support of the transaction, Borders Group Inc. says.