Paperchase has insisted it will remain largely unaffected by the administration of Borders UK despite operating 38 concessions in the collapsed chain.

Paperchase chief executive Timothy Melgund told Retail Week he sees long term potential for up to 200 standalone stores in the UK and does not believe Borders’ collapse will have a huge impact on sales.

The news comes as former Books etc owner Richard Joseph is understood to be in talks to buy nine stores from Borders’ administrator MCR.

Paperchase said sales in its 38 Borders concessions accounted for 13% of revenue this year, and it had forecast they would account for less next year – less than 10% – as it was set to open more standalone shops.

Melgund said Paperchase had been opening shops close to Borders – including Islington, Leeds and Oxford – to offset any negative effect if the book stores should close.

Melgund, who reiterated that Paperchase is owned by US business  Borders Inc, not Borders UK with which it only has a trading relationship, said “we may even make more than 10% of sales back” next year through opening shops. He added that some concessions made more than £1m in annual revenue.

The 60-store retailer, which is considering launching a transactional website next year, wants to open 15 to 20 UK shops in 2010 through property agent CB Richard Ellis.

Paperchase is trialling a US standalone store that will be rolled out if successful. It is also considering a concession in a fashion chain.

The retailer experienced a 20% dip in profits last year but Melgund said this year it has been “trading well”, with like-for-likes in the “high single digits”.

Last year Paperchase was put up for sale by Borders Inc but Melgund said the business is no longer up for sale.

The retailer operates outlets in the US, Holland, Ireland and the Middle East, and has UK concessions in House of Fraser and Selfridges.

Game and Red5, which also have Borders concessions, said they would not be badly affected by Borders store closures as they owned their own stock.

Interest in Borders UK has emerged, with Joseph, who sold the Books etc chain to Borders in 1997, understood to have made a “substantial offer” to MCR for nine key Borders sites. Joseph could not be reached for comment.

All Saints and HMV are both still in talks with property agent Capa about taking Borders stores. All Saints is also thought to be about to sign a deal on the Regent Street store Nokia is pulling out of next year.

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