Barnes & Noble Slides After Founder Withdraws Offer
NEW YORK (AFP) – U.S. bookseller Barnes and Noble saw shares slide Tuesday after reporting fresh losses and the withdrawal of an offer by its founder to buy the retail arm of the struggling company.
In midday, B and N shares tumbled 16 percent to $13.97 after reporting a net loss of $87 million in the quarter to July 27.
Revenues fell both in the retail book division and the Nook digital unit, which produces tablet computers and e-readers.
In its quarterly earnings statement, the company said chairman Leonard Riggio advised the board of directors that he has “suspended his efforts to make an offer for the company’s retail business.”
In a regulatory filing, Riggio wrote: “While I reserve the right to pursue an offer in the future, I believe it is in the company’s best interests to focus on the business at hand.”
He added: “Right now our priority should be to serve the more than 10 million customers who own Nook devices, to concentrate on building our retail business, and to accelerate the sale of Nook products in our stores, and in the marketplace.”
Barnes and Noble has been hit hard by a shift to online sales and by growth in electronic books, but has countered with its Nook devices, which have only a tiny segment of the tablet market. In July, William Lynch resigned as chief executive.
Riggio unveiled his proposal in February to buy the retail division while leaving Nook to operate separately.
A news report in May said Microsoft, which invested $300 million in Nook, was interested in buying that unit.
In June, Barnes and Noble said it would seek a partner to produce the Nook tablet while maintaining production of e-readers, and would also focus on apps for other devices.
On a conference call to discuss results, Nook unit president Michael Huseby said the June announcement was misinterpreted by some and that the company “intends to continue to design and develop innovative Nook black-and-white and color devices.”
He added that “at least one new Nook device will be released for the coming holiday and further products are in development.”