Barnes & Noble buyout: Barnes & Noble sold to hedge fund Elliott Management

Bloomberg
A Barnes & Noble store in New York in 2016

Bloomberg A Barnes & Noble store in New York in 2016

Hedge fund Elliott Management Corp is in talks to acquire Barnes & Noble Inc, in a deal that would mark the end of the once-dominant US book retailer as a publicly listed company, a source familiar with the matter said on Thursday.

Signage for a Barnes & Noble bookstore is displayed on the side of the store, January 10, 2019 in the Brooklyn borough of New York City.

The bookseller is being bought by Elliott Management's affiliate, Elliott Advisors (UK) Ltd. After acquiring United Kingdom book retailer Waterstones a year ago, Paul Singer's NY hedge fund believes it has the right model to take on Amazon.com, and will employ James Daunt, chief executive officer of the British bookstore chain, to run Barnes & Noble as well. The company's annual sales have fallen for the past three years.

The move marks Elliott's second major splash in the world of books in the span of a year.

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Barnes & Noble stock soars after talks of possible sale; Popeyes Louisiana Kitchen celebrates its 3,000th restaurant by serving up boneless chicken wings dipped in champagne and coated in 24-karat gold batter. And prior to that there were years of management turnover, strategic misfires and lost sales as the last box book seller tried to hold off Amazon. The deal is valued at around $683 million, including the assumption of debt, according to the Wall Street Journal. Along the way, it's weathered self-inflicted wounds and internal drama.

"In chain bookselling, you need to try and get the best store for each location", Daunt told The Associated Press. A big investment in its Nook e-book device - a competitor for Amazon's Fire tablets - was ultimately a bust. The company's stock fell 30 percent under former CEO Demos Parneros's watch, which began in April of 2017.

The deal would close the book on Barnes & Noble's long - and of late, troubled - run as a public company. BlackRock Inc. lifted its holdings in shares of Barnes & Noble by 15.6% during the 1st quarter. Independent bookstores have also persisted in the face of digital publishing. "We meet these with investment and with all the more confidence for being able to draw on the unrivaled bookselling skills of these two great companies", Daunt said in a statement.

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