Struggles at Ann Arbor-based Borders Inc, seem to be helping drive value increases for rival bookseller Barnes and Noble, which fielded a $1 billion buyout offer and now is watching its stock price soar above that level.

The investor demand for Barnes and Noble - which retains its bricks-and-mortar sales model - stands in contrast to the bankruptcy at Borders.

While Borders closes 200 stores and consolidates its operations into a smaller corporate footprint, Barnes and Noble, despite its low digital sales and the bookstore industry's fast-changing fundamentals, is worth an estimated $1.06 billion based on today's trading.

According to a report from Bloomberg, the cutbacks at Borders make Barnes and Noble more attractive to investors. Barnes and Noble was willing to buy about 10 of the Borders stores out of bankruptcy and no other buyers have come forward, leaving Borders' future as the chain's key store competitor in question.

Meanwhile, Bill Ackman, the largest investor in Borders, stands to lose an estimated $200 million on his investment in the company. He also pitched the idea of Borders acquiring Barnes and Noble last December.

Read the full Bloomberg story.