Sat, May 21, 2011 - Page 10 News List

Barnes & Noble reports US$1bn bid from Liberty Media

FLOGGING A DEAD HORSE:Book sellers face increased competition from online sites and discounters. Borders Group filed for bankruptcy court protection in February


Barnes & Noble Inc said on Thursday that online retail, media and communications conglomerate Liberty Media Corp offered to buy the book seller for US$17 per share in cash. That amounts to about US$1.02 billion, based on the number of shares the company had outstanding as of March.

Barnes & Noble shares jumped more than 24 percent in extended trading after the company -announced the potential deal. The offer values Barnes & Noble shares at 21 percent higher than their Thursday closing price of US$14.11.

The companies have not yet signed an agreement and the deal is still subject to closing conditions, including one that founding chairman Leonard Riggio retain a stake in the company and remain in a management position, Barnes & Noble said.

Barnes & Noble, which is based in New York and is the largest traditional book seller in the US, said a board committee would evaluate the offer.

The company put itself up for sale in August in response to pressure from billionaire activist shareholder Ron Burkle.

Traditional book sellers have been facing increased competition from online sites and discounters. Much smaller Borders Group — based in Ann Arbor, Michigan, and the nation’s second-largest book store chain — filed for bankruptcy court protection in February. It has since been carrying out plans to close more than one-third of its stores, and it is reportedly in talks for the purchase of some or all of the remaining stores.

Both companies have looked to online sales and to digital books and e-readers as ways to stem the steady decline in book sales in recent years.

Liberty Media operates three publicly traded companies — Liberty Interactive Inc, Liberty Starz Group and Liberty Capital Group — through which it owns stakes in home-shopping network QVC, movie channel operator Starz LLC and satellite radio company SirusXM Radio Inc.

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