There was some floor chatter at BEA about Barnes & Noble yesterday — although we all know Borders is not long for this world, some are suggesting that all the book chains are going to be bye-bye within two years. This despite the recent $1 billion purchase bid for Barnes & Noble by John Malone’s Liberty Media. But is Malone’s bid really about brick and mortar stores?
The Liberty Media bid has been greeted with some head-scratching among analysts and commentators. Mr. Malone, to be sure, is quite skilled in the dark arts of deal-making. He is an able negotiator, and many of his deals are quite complicated with a financial angle like tax savings. Still, it’s not clear that is the case here.
So far, most of the reasons given for the interest in Barnes & Noble center on its e-reader, the Nook. Mr. Malone implied that the Nook was a primary reason for Liberty Media’s bid at the company’s shareholder meeting on Monday. Though exact figures are unavailable, Barnes & Noble captured as much as 27 percent of the e-book market with its Nook, according to a Goldman Sachs report, and may have found a way out of the decline in storefront book selling.
With e-book sales now passing print sales on Amazon, and a new touch-screen Nook introduced yesterday, it’s easy to see why a cute little e-device would be a nice trophy on the mantle of a media mogul. But for $1 billion you could probably buy an actual device manufacturer, not just a bookstore chain.
Much more on B&N and its fortunes in the link.