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The founder of Barnes & Noble has launched an offer to privatize the country's last major bookstore chain 25 years after its launch on the US stock market.
Leonard Riggio, chairman and principal shareholder of the New York-listed company, was one of many parties to show interest in acquiring the company, Barnes & Noble said Wednesday.
Private equity funds and listed companies were among the people interested in a possible purchase, said a person informed of the sales process.
The disclosure prompted Barnes & Noble to strive to improve sales in the face of pressure from Amazon and other rivals, rising 22 percent to $ 6.70 in the afternoon session. .
Barnes & Noble has already dominated the industry and made itself known for its big-box bookstores, which expanded rapidly during the 1980s and 1990s, as independent sellers declined. The disruption of retail has even provided the story of the 1998 romantic comedy of Tom Hanks and Meg Ryan You have an email.
But its own subsequent struggles to cope with the disruption of e-commerce have left society vulnerable to rapid control. Even after Wednesday's recovery, stocks are still down 78% from the peak of 2006, when the company was valued at $ 3.2 billion. The market value of Barnes & Noble was less than $ 400 million before the issue of the shares on Wednesday, while the company had a long-term debt of $ 178 million at the end of July.
The company said its board of directors had appointed a special committee to evaluate the bids. He includes Mark Carleton, Paul Guenther, Patricia Higgins and Kimberley Van Der Zon. The committee will also be informed by separate legal and financial advisors, which it has not yet appointed. The company itself is advised by Guggenheim Securities and the law firm Paul Weiss.
The board stated that Mr. Riggio was committed to supporting the suitor that the special committee was finally recommending, despite his personal interest in the company being privately owned. He added that he could give no assurance that an agreement would be reached.
The decision to initiate a formal review process was motivated by the creation of a stake by a unique mystery shopper in the Barnes & Noble free market, which, according to the bookseller, was in the form of of rapid material accumulation ". Barnes & Noble said it was unable to identify the purchaser of its shares and that it would adopt a shareholder rights plan – a decision that could thwart hostile buyers.
The plan allows the Company to offer preferred shares to shareholders with a 50% discount if an investor or group, without the approval of the board of directors, acquires 20% or more of the outstanding shares. The investor who triggers the execution of the rights issue plan is not able to buy shares at a discounted price.
The identity of the plaintiffs other than Mr. Riggio was not revealed on Wednesday. According to a complaint filed in August by the company's former CEO, Demos Parneros, a rival bookseller made a takeover bid earlier this year. In June, after conducting a due diligence, the offer was withdrawn.
In his trial, Mr. Parneros claimed that Mr. Riggio had fabricated good reasons for dismissing him. Mr. Parneros claimed to have been falsely accused of misconduct.
In response to the lawsuit filed against it, the company said that a "thorough investigation" had "revealed multiple instances of serious misconduct" of Mr. Parneros.
Mr. Riggio founded modern society in 1971 by buying a single store with the name.
Barnes & Noble went public in 1993 at $ 20 per share and its chairman still owns 19% of the capital, according to the latest proxy documents of the Securities and Exchange Commission. In 2015, in an effort to increase the share price of the company, Barnes & Noble sold its book business for school and college books.
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