Barnes & Noble founder Leonard Riggio and chairman plans to buy the retail business but not the Nook Media unit that operates the Nook digital business and college bookstores, according to a regulatory filing with the Securities and Exchange Commission and a statement released on Monday.
According to the press statement, Riggio will buy "retail business" which includes the physical stores and Barnes & Noble website, but not Nook Media LLC. The purchase price is still being negotiated by the company's board. Riggio owns 30 percent of the company.
The deal will be done mostly in cash and the assumption of "certain liabilities of the company," according to a document filed with the Securities and Exchange Commission. Riggio would provide the equity financing and arrange any debt financing required for the deal.
"Riggio loves the (retail) business too much to let it go," Morningstar analyst Peter Wahlstrom said according to Reuters, adding that as a slow-growing business it did not need a lot of capital to keep going.
"The retail business for Barnes & Noble is mature (to) declining, but it's profitable. The company has done a good job executing amid a pretty challenging environment," Wahlstrom added.
According to the company's earnings report, he combined college book and Nook business, which includes the e-reader, digital content and accessories, made up about 50 percent of the company's total sales of $1.88 billion in the second quarter ended October 27.
"We have no plans to discontinue our award-winning line of Nook products," says company spokeswoman Mary Ellen Keating, in a statement.
