Best Buy Founder’s Buyout Bid Ends

by Christopher Freeburn | March 1, 2013 9:16 am

Best Buy 300x199 Best Buy Founder's Buyout Bid Ends[1]Best Buy‘s (NYSE:BBY[2]) founder has not made a bid to take the struggling chain private[3]. Despite the lack of a bid, Best Buy shares surged about 5% in pre-market trading on Friday.

The big box electronics retailer said that Richard Schulze had until Thursday to make a bid under a prior agreement with the company’s board. Instead, sources told Bloomberg  that Schulze had and attempted to obtain three seats on Best Buy’s board by acquiring a minority stake in the chain with a group of private equity firms, but those talks have ended.

Rumors had surfaced in recent weeks that Schulze had been unable to raise the needed financing[4] for a takeover bid and was concentrating on taking a minority stake as an alternatives.

Schulze remains Best Buy’s biggest shareholder, controlling about 20% of its stock. He was forced to step down as chairman[5] in June after it emerged that he had failed to inform the board of an improper relationship between ousted CEO Brian Dunn and a female employee.

In August, Schulze announced that he would make a bid to take Best Buy private[6], offering between $24 and $26 a share.

The company has hired turnaround expert Hubert Joly as its CEO and has announced job cuts at its Minnesota headquarters[7].

Shares of Best Buy in Friday pre-market trading.

Endnotes:
  1. [Image]: http://investorplace.com/wp-content/uploads/2011/05/Best-Buy.jpg
  2. BBY: http://studio-5.financialcontent.com/investplace/quote?Symbol=BBY
  3. not made a bid to take the struggling chain private: http://www.bloomberg.com/news/2013-03-01/best-buy-talks-with-founder-richard-schulze-said-to-have-ended.html
  4. unable to raise the needed financing: http://investorplace.com/2013/02/best-buy-buyout-may-be-off/
  5. forced to step down as chairman: http://investorplace.com/2012/05/best-buy-chairman-resigns-after-ceo-inquiry/
  6. would make a bid to take Best Buy private: http://investorplace.com/2012/08/best-buy-reaches-due-dilligence-deal-with-schulze/
  7. announced job cuts at its Minnesota headquarters: http://investorplace.com/2013/02/best-buy-lays-off-400-at-headquarters/

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