Laughing Water Capital • 15 Comments
Dec. 5, 2014, 5:30 PM
- Following a 7.6% gain today, Barnes & Noble (NYSE:BKS) has more than erased the big losses it initially saw on Thursday after posting an FQ2 EPS miss and announcing it's buying back Microsoft's 17.6% Nook Media stake.
- TheDeal reports today Wal-Mart is interested in the e-book market and could make a bid for Nook Media. Worth noting: Much of Nook Media's value is tied to its college bookstore ops rather than the Nook hardware and digital content businesses.
Dec. 4, 2014, 9:49 AM
- Along with its FQ2 results, Barnes & Noble (BKS -11.4%) has announced it's buying Microsoft's (MSFT +1.6%) stake in Nook Media for $62.4M in cash and 2.7M shares (current value of $52.8M). The companies have also "agreed to terminate their commercial agreement." (8-K)
- With Microsoft having invested $300M in Nook Media (contains B&N's Nook hardware, online bookstore, e-book, and college bookstore ops) in 2012 for a 17.6% stake, the software giant is taking a ~$185M loss on its investment.
- B&N's Nook segment revenue (covers hardware, digital content, and accessories) fell 41.3% Y/Y in FQ2 to just $62M, thanks to tough competition from Amazon and ongoing tablet cannibalization of e-readers. B&N's college segment saw revenue rise 1.9% to $751M.
- The sale follows Microsoft's July decision to lay off roughly half the workers in its Nokia phone unit, as part of a broader restructuring.
Feb. 21, 2014, 5:04 PM
- There's plenty of skepticism G Asset Management has the resources to make good on its latest Barnes & Noble (BKS) acquisition offer. One major reason: A 2012 Form D filing indicating the firm raised only $1.75M in an offering.
- David Faber: "[G Asset] runs very little money and I mean very little. Not sure if he lives at home with his parents, but you get the idea."
- B&N closed at $17.69, nearly 20% below G Asset's offer price.
Feb. 21, 2014, 1:43 PM
- G Asset Management has offered to buy a 51% stake in Barnes & Noble (BKS +7%) at a $22/share valuation, or (alternatively) a 51% stake in the Nook division at a $5/share valuation. B&N shares have jumped to the $18 range in response.
- The money manager adds its offer is subject to due diligence and "the obtaining of necessary financing," as well as access to B&N's credit facility and balance sheet cash. It thinks "substantial shareholder value" would be created if the Nook segment was separated from B&N's profitable units.
- Two years ago, G Asset offered to buy B&N's college bookstore business for $460M.
Jun. 12, 2013, 4:16 PMMicrosoft (MSFT) isn't interested in Nook Media's (BKS -6.1%) digital assets, sources tell dealReporter. The report led Barnes & Noble shares to dive over the final 15 minutes of trading. TechCrunch reported of Microsoft's interest in Nook Media last month, but a source later told Insider Monkey Microsoft "has no intention" of making a deal. | Jun. 12, 2013, 4:16 PM
May 13, 2013, 1:52 PM
"This deal was nothing more than a rumor ... [Microsoft] has no intention of acquiring the NOOK unit. NOOK is closely integrated with Android ... The acquisition is not happening in the foreseeable future as Microsoft Corporation is assessing its options at this time." Thus speaks a Microsoft (MSFT) source to Insider Monkey, strongly refuting a TechCrunch report about an offer to buy Nook Media's digital assets for $1B. Barnes & Noble (BKS -14.1%) shares have plunged, but for now are still up 13% from where they stood prior to the report.| May 13, 2013, 1:52 PM | 3 Comments
May 9, 2013, 9:30 AM
Investors are racing ahead of analysts over a potential deal by Microsoft to buy Barnes & Noble's (BKS) Nook Media digital assets outright. Stifel Nicolaus analyst David Schick warns it's not clear if B&N's board has even seen the offer and what the full impact will be for the remaining trimmed-down company. No bother, BKS +27.7% premarket anyway.| May 9, 2013, 9:30 AM
May 8, 2013, 10:52 PM
Microsoft (MSFT) is offering $1B for Nook Media's (BKS) e-reader, tablet, and e-book ops (but not its college bookstore arm), TechCrunch reports. If true, the valuation assigned to NM is well below the $1.7B given when Microsoft bought a 17.6% stake (diluted to 16.8% by Pearson's investment) in April '12. Documents indicate NM (exc. the college ops) is expected to post FY13 (ended in April) revenue of $1.09B (-10% Y/Y) and an EBITDA loss of $360M, plans to discontinue its tablet line (makes sense, given market share trends), and will focus on content sales. Is such a business worth $1B? Regardless, Barnes & Noble ($1.06B market cap) should see a pop on the report. (FY13 warning) (FQ3 results)| May 8, 2013, 10:52 PM | 4 Comments
Oct. 15, 2012, 4:05 AM
Amazon (AMZN) is in negotiations to acquire TI's (TXN) cellular-chip operations in a deal that would be worth billions of dollars, the Calcalist Israeli newspaper reports. TI, whose chips are used in Kindle devices and Barnes & Nobles' (BKS) Nooks, has already said it won't invest in supporting its customers' plans for smartphones and tablets to the same extent as previously.| Oct. 15, 2012, 4:05 AM | 9 Comments
Apr. 30, 2012, 7:27 AM
Barnes & Noble (BKS) +79% premarket as Microsoft (MSFT) wades into e-books with a $300M investment in the company's Nook and College operation. 9to5mac notes the deal seemingly puts an end to patent litigation between the companies and that BKS would seem to be abandoning Android as their future e-Reader OS.| Apr. 30, 2012, 7:27 AM | 1 Comment
Mar. 16, 2012, 6:16 PMBarnes & Noble (BKS) +1.8% AH after shareholder G Asset Management offers to buy 51% of the company's college bookstore business for $460M. The business, which B&N bought for $596M in 2009, is a cash cow, but its sales fell 3% Y/Y in the January quarter, as online competition begins to have an impact. | Mar. 16, 2012, 6:16 PM | 1 Comment
Jan. 6, 2012, 11:13 AM
One of Michael Humphrey's five reasons Google (GOOG) should buy Nook (BKS): "If Google, whose OS powers the current Nook, were to enter the hardware sector, why not do it with a machine that has already proven itself?" But if you believed Google "has no idea" how to run a global hardware business when it announced its deal with Motorola, wouldn't that still apply today?| Jan. 6, 2012, 11:13 AM
Jan. 5, 2012, 5:14 PM
The planned spinoff of Barnes & Noble's (BKS) Nook business could make it an acquisition target, claims Maxim Group's John Tinker. With $1.5B in e-book/e-reader revenue, a price/sales multiple of 1x would translate into a $22/share buyout price, nearly twice B&N's current level. But Amazon's aggressive pricing and the Kindle Fire's early success could put some would-be buyers on edge. (earlier)| Jan. 5, 2012, 5:14 PM | 1 Comment
Jan. 5, 2012, 12:47 PMDoug McIntyre speculates Sony (SNE -3.1%) could be a viable partner for Barnes & Noble (BKS -21.7%) and take a large equity position in a Nook spinoff. If the $750M 2012 sales forecast for BKS digital content is right, a Nook company could be worth $3B-$4B. BKS shareholders could retain a majority interest in Nook, which "may be more worth more than Barnes & Noble is in its entirety today." | Jan. 5, 2012, 12:47 PM
Nov. 11, 2011, 12:55 PM
Nov. 11, 2011, 12:10 PMBarnes & Noble (BKS +8.9%) shares soar to three-month highs on speculation that Liberty Media (LCAPA +2.5%) may buy the rest of the company. Liberty may be setting up a $1.5B credit facility to help fund a purchase of the bookstore chain, Phoenix Partners analyst Robert Routh says. | Nov. 11, 2011, 12:10 PM