Tuesday, 21/11/2017 | 7:55 UTC+5
Mehta Websolution's Blog

Barnes and Noble, Microsoft end two year Nook Media partnership

Barnes & Noble struck a deal to buy Microsoft’s stake in Nook Media LLC, ending a two-year partnership and clearing the way for the bookseller to spin off its loss-making e-reader and digital content division.

Barnes & Noble shares closed down 5.4 percent on the New York Stock Exchange after the company also reported a much-weaker-than-expected quarterly profit, due to lower sales of Nook devices.

The company estimated the value of the cash and share deal at about $125 million.

Nook, launched in 2009, enjoyed initial success but has ended up costing Barnes & Noble hundreds of millions of dollars as it was unable to keep pace with Amazon.com’s Kindle and Apple’s iPad.

Microsoft invested $300 million in Barnes & Noble’s Nook e-reader in 2012 to gain a foothold in the fast-growing e-books market. As of Sept. 9, Microsoft owned about 17 percent of Nook Media through preferred shares.

Barnes & Noble said in June it would spin off its Nook Media business, which includes college bookstores, to focus on its retail book business.

“We mutually agreed that it made sense to terminate the agreement,” a Microsoft spokesman said in an email. Microsoft will lose money on its initial investment, but will also be spared any future payments to fund Nook, which were running at about $21 million per quarter.

Under the agreement announced on Thursday, Microsoft will have the right to receive about 22.7 percent of total proceeds of Nook’s digital business, which excludes the college bookstores, if it is sold in the next three years.

Pearson Plc owns 5 percent of Nook Media, which had revenue of $815 million in the second quarter ended Nov. 1.

The company said it would buy Microsoft’s stake in Nook Media for $62.4 million in cash and about 2.7 million in shares.

Barnes & Noble said it now expected to complete the separation of its Nook Media business at the end of August 2015. It had earlier expected to complete it by March.

The company said its total revenue fell 2.6 percent to $1.69 billion in the second quarter. Retail sales fell 3.6 percent.

Net income fell to $12.3 million, or 12 cents per share, from $13.2 million, or 15 cents per share, a year earlier. Analysts on average expected a profit of 31 cents per share on revenue of $1.69 billion, according to Thomson Reuters I/B/E/S.

About

Mehta Websolution is a web development company based in Jamnagar, Gujarat, India. providing a full range of web services including web design, web development, web promotion, search engine optimization, web hosting and domain registration and all Internet services at accessible cost since it was established in 2007. A company which provides you a full range of web services Contact us for web design, web development, web promotion, search engine optimization, web hosting and domain registration at an affordable cost. IF you are looking for an IT Solutions Provider who can implement your Dreams in a reality form of exhaustive web applications, innovative software, and creative designs or for fastidious solutions and persistent services, you are at the right place. we provide you software development and web solutions all across the globe. Our strategic location and proven experience enables us to provide you with the best services and outsourcing for your Software Development, Web Development, E-commerce, Multimedia Presentations and Web Based Applications at the corporate level.

POST YOUR COMMENTS

Your email address will not be published. Required fields are marked *

19 − nine =

Mehta Websolution Since 2007

Company is Government & Defence (Indian Navy, Army & Air Force) Approval I.T. Contractor, An ISO 9001:2008 Certified I.T. Company and Google Enterprise for Work Partner.