Does B&N Have A Buyer?

Investment firm G Asset Management said on Friday that it had offered to acquire a 51 percent stake in either Barnes & Noble Inc or in the bookseller’s Nook digital business.

The little known firm said the proposal for Barnes & Noble as a whole would be for $22 per share, which would value the top U.S. bookstore chain at $1.32 billion. It comes after earlier proposal in November for $20 per share, its second.

G Asset, which not did detail how it would finance a deal, also made an alternative offer to buy Nook for $5 per share, saying spinning off the digital books and device business would create “substantial shareholder value.”

The latest offer for the whole company would value Barnes & Noble at $1.32 billion, while the proposal for Nook would value that unit at about $300 million.

The firm has previously pressed the company to spin off its Nook unit from Barnes & Noble’s bookstore and college units.

Michael Glickstein, G Asset’s Chief Investment Officer, and the only person listed on the firm’s website, did not immediately return a request for comment.

Barnes & Noble shares were up 5.8 percent at $17.75 in afternoon trading after going as high as $19.12 after the news was released, suggesting Wall Street analysts were doubtful a deal would get done.

A Barnes & Noble spokeswoman declined to comment beyond confirming that the company had received G Asset’s offer.

The original Nook device was launched in 2009 to help Barnes & Noble fend off Amazon.com Inc and allowed the retailer to win as much as 27 percent of the U.S. e-books market.

But the company lost hundreds of millions of dollars trying to keep pace with deep-pocketed rivals such as Amazon, Apple Inc and Google Inc. It has scaled back its Nook business and focusing more on content and software.

Two years ago, Microsoft Corp invested $300 million in the Nook unit for a 17.6 percent stake, valuing the division at $1.7 billion. In late 2012, Pearson PLC took a 5 percent stake in Nook for $89.5 million.

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Analysts Expect Flood of Cheap Tablets This Fall

Analysts are predicting that a whole slew of $200 to $300 tablet computers will hit the market this fall, prompting the essential question: Which device will come out on top?

Several analysts are betting on Amazon.com to be at the top of the pile with an expected $299 Android-based tablet introduced sometime in October. The reason it will do
well is only partly because of the low price, which is below the market-leading iPad 2, starting at $499.

But analysts also expect Amazon to offer content for its 9-in. tablet thats comparable to or even exceeds the content that Apple can offer for the iPad. Amazon will make money on the content it sells, which is expected to more than make up for any loss it incurs in selling the tablet at a price below the cost of making it.

“Amazon has an ecosystem like Apple, with its own app store that offers music, movies and videos, and a bookstore,” said Bob O’Donnell, an analyst at IDC. “Not only would you get a cheaper device [than the iPad], you would get the integrated Amazon experience. That’s what makes Amazon’s tablet the most interesting and where other [Android] tablets will be challenged.”

In effect, Amazon’s approach will be to entice buyers with a much lower price, “but have all the services of Apple,” O’Donnell said.

Other Android tablets with which Amazon would likely compete include a $199 Lenovo IdeaPad A1 tablet announced Thursday, the cheapest 7-in. Android tablet from a top device maker. Another contender is the original Samsung Galaxy Tab, which is being sold on Amazon for $279.99, after having first appeared late in 2010 for $600.

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