Barnes & Noble is pondering a sale after receiving interest from multiple parties, including its executive chairman, Leonard Riggio.
According to news from The Wall Street Journal, the company admitted that it is launching a formal review process, led by a special committee, to go over its options. In addition, the company has implemented a short-term shareholder rights plan (also known as a poison pill) to deter an unsolicited buyer.
Barnes & Noble has watched its market share decline through the years, falling more than two-thirds since 2015 to about $400 million. For the full fiscal year that ended April 28, total sales fell 6 percent to $3.7 billion. Yet the company has kept moving forward, opening new stores this year and forecasting a boost in earnings in fiscal 2019.
The retailer has also fallen short with its digital offerings. Its Nook eReader failed to compete with devices from Amazon and Apple. It’s no surprise Amazon has played a major role in the bookseller’s issues: The eCommerce giant now accounts for more than 60 percent of all books sold online, including physical and digital books. As for Barnes & Noble, online revenue fell 14 percent in the most recent quarter.
Barnes & Noble’s executive turmoil also hasn’t helped its problems. In July, it was reported that a violation of company policies cost Barnes & Noble CEO Demos Parneros his job. While the retail chain did not detail the specific nature of how Parneros broke the rules, it said that his firing “is not due to any disagreement with the company regarding its financial reporting, policies or practices or any potential fraud relating thereto.”
“Mr. Parneros will not receive any severance payment, and he is no longer a member of the company’s Board of Directors,” the company added.
But there is some good news out there: Data shows that print book unit sales rose slightly last year to 687 million.
“The publishing industry today is robust,” said literary agent Richard Pine. “You have new authors breaking through, together with the tried-and-true authors selling.”