Bookseller Barnes & Noble is just starting to get into the thick of the ebook and ereader market with its Nook electronic readers and electronic bookstore…but now that the company seems to finally have built up a good head of steam, the board of directors has dropped a bit of a bombshell: they plan to “evaluate strategic alternatives,” including a possible sale of the company, in an effort to boost the price of Barnes & Noble shares, which the company believes to be undervalued.
“As the world’s largest bookseller, Barnes & Noble has an iconic brand and unique competitive advantages we believe will position the company to succeed over time in a rapidly changing market,” the Barnes & Noble board wrote in a statement. “The Board has concluded that a review of strategic alternatives is the appropriate next step to take full advantage of our compelling digital opportunities and to create value for shareholders, customers, and employees.”
Barnes & Noble founder and single largest shareholder Leonard Riggio has said he’ll look into assembling an investor group with an eye towards acquiring the company. The Board has set no timetable for its strategic review, and doesn’t intend to comment any further unless an offer is put on their table.
In addition to its digital marketplace, Barnes & Noble runs over 700 bookstores in the United States.
Barnes & Noble may have trouble finding buyers: the entire book industry has been in tumult for years: first, companies like Barnes & Noble used scale to put many smaller booksellers out of business, then companies like Amazon.com used the Internet to undercut the sales advantage of brick-and-mortar retailers. Now Amazon has established itself as a leader in the ebooks market with the success of its Kindle line; Barnes & Noble is in the ebook business too, but so are Sony, Borders, and, of course, Apple.