Best Buy founder eyes privatization
Source: Agencies |
August 7, 2012, Tuesday
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Print Edition
Print Edition
BEST Buy's founder yesterday said he wants to take the electronics retailer private by buying up all of its shares he doesn't already own in a deal that values the company at as much as US$8.84 billion.
Richard Schulze also served as the Minneapolis-based company's chairman until resigning in June amid a scandal involving its CEO. Schulze said he wants to pay between US$24 and US$26 per share for Best Buy.
This represents a 36 percent to 47 percent premium over the company's closing stock price last Friday.
Based on Best Buy's 339.9 million outstanding shares, the offer values the company at US$8.16 billion to US$8.84 billion.
Schulze is Best Buy's largest shareholder, controlling 20.1 percent of its shares. At US$26 per share, he would pay about US$6.9 billion for the rest of the company.
The former executive said he would have preferred to pursue a deal privately, but a deal needs to happen quickly.
"I am deeply concerned that further delay and indecision will cause additional loss of both value and talented leaders who are now uncertain of the company's future," Schulze said in a statement.
In his letter to Best Buy's board, Schulze said he's developed a plan to deal with the company's challenges and has talked with private equity firms. Schulze said he would finance the deal through a combination of private equity investments, about US$1 billion of his own equity and debt.
Richard Schulze also served as the Minneapolis-based company's chairman until resigning in June amid a scandal involving its CEO. Schulze said he wants to pay between US$24 and US$26 per share for Best Buy.
This represents a 36 percent to 47 percent premium over the company's closing stock price last Friday.
Based on Best Buy's 339.9 million outstanding shares, the offer values the company at US$8.16 billion to US$8.84 billion.
Schulze is Best Buy's largest shareholder, controlling 20.1 percent of its shares. At US$26 per share, he would pay about US$6.9 billion for the rest of the company.
The former executive said he would have preferred to pursue a deal privately, but a deal needs to happen quickly.
"I am deeply concerned that further delay and indecision will cause additional loss of both value and talented leaders who are now uncertain of the company's future," Schulze said in a statement.
In his letter to Best Buy's board, Schulze said he's developed a plan to deal with the company's challenges and has talked with private equity firms. Schulze said he would finance the deal through a combination of private equity investments, about US$1 billion of his own equity and debt.
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