Barnes & Noble faces the opening of a new chapter as the US book chain received an offer from G Asset Management, a private investment group, for a controlling interest.
The investment group is seeking to buy 51 per cent of shares in the book retailer at $22 a share, a 30 per cent premium to the share price on Thursday before the offer was announced. The shares on Friday rose as much as 14 per cent before closing up 5.4 per cent at $17.69.
G Asset Management said it would also consider taking a 51 per cent stake in the company’s Nook e-reader and tablet unit, which it values at $5 a share.
The group, which describes itself as a value-oriented opportunistic investor, is run by Michael Glickstein, the president and chief investment officer, who started out as a research analyst at Goldman Sachs.
The New York-based firm has had an interest in Barnes & Noble for some time, first disclosing a stake of 5 per cent in 2012.
In its statement, G Asset Management said it was “extremely confident that if the Nook segment is separated from the profitable retail and college business, substantial shareholder value would be created.”
It added that it had proposed a separation of the Nook business to Barnes & Noble’s board of directors last November, and at that time had offered to purchase the controlling interest in Barnes & Noble at $20 per share.
A spokesperson for Barnes & Noble confirmed the company had received the latest proposal but had no further comment.
The bookseller has encountered rough trading conditions, with its retail segment reporting a 0.2 per cent decline in core same-store sales over the holiday period.
Sales it its Nook arm, which includes digital content, devices and accessories, slumped 60.5 per cent during the holiday period.
Last month, Barnes & Noble named Michael Huseby its new chief executive and he has since focused on stemming the slide in the Nook business.
Before assuming the top job Mr Huseby was chief executive of the Nook tablet business, and became president of Barnes & Noble following the unexpected resignation of chief executive William Lynch in July last year.
One of the biggest questions for Barnes & Noble has been whether the company would split into two, dividing its bricks-and-mortar retail business from the Nook digital business, which includes ebooks, ereaders and tablet computers.
When Microsoft bought a 17.6 per cent stake in Nook for $300m in 2012, the terms of the deal called for the Nook business to be split from the rest of the company within five years.
Pearson, owner of the Financial Times, has a 5 per cent stake in Nook.
Barnes & Noble is due to report earnings next Wednesday, and the quarter could “prove to be a key inflection point,” said John Tinker, Maxim Group analyst.
Another outstanding factor in its ownership is the position of John Malone’s Liberty Media, which has an investment of about $204m in Barnes & Noble.