The convenience and cost of eBooks is so tempting… I can’t help but wonder if the rise of the eBook will mean the fall of a bookselling giant.
Barnes & Noble Selling?
The board of directors of B&N announced late Tuesday that they are considering selling the chain. Stock has performed poorly despite plans to expand digital sales.
Current share prices are up from $12.84 on Tuesday to $16.25 this morning amid rumors of a possible sale. This is still much lower than the 52 week high of $28.78. B&N chairman, Len Riggio, is rumored to be considering taking the company private.
Poison Pill
Recent issues with outside stockholder Ron Burkle after he acquired a major amount of stock, led to the board passing a poison pill provision. This is a strategy designed to deliver negative results in the event of a takeover of a business. It is meant to deter takeover attempts. Burkle has sued B&N to have the poison pill removed and the ruling from the July trial should be handed down soon.
No Plans to Close Any Offline stores.
B&N’s strategy for increasing stock prices has been focused on increasing eBook sales and the sale of its Nook eReader devices while maintaining and increasing sales of print books. They had no plans to close any physical stores. With many experts wondering about the future of bricks-and-mortar bookstores, it’s little wonder that this did not do much to improve stock prices.
Will Amazon Buy?
There are, of course, rumors circulating that Amazon will swoop in to buy B&N. This would cement their position as leader in the eBook market. Other potential buyers are billionaire investor Ron Burkle, as stated above, and current board member and company founder Leonard Riggio. There’s also a past statement from a large stakeholder in Borders that the two companies could combine.
What will the future Hold?
The future of B&N is uncertain. They are vulnerable to takeover, especially if the poison pill provision is removed. What that means for the large retail bookseller is wholly dependent upon who takes over and what their vision is and what goals they have for the business.
it does make driving to the store seem obsolete
I generally shop at Amazon and Audible, though I do admit to the occasional trip to the bricks and mortar B&N. It is convenient when the kids need a book pronto, but with the ease of obtaining instant eBooks from Amazon – though they would need a compatible device – it does make driving to the store seem obsolete.
What are your thoughts on the bookstore giant toppling?
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DorothyD
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