Elliott Management has plans to acquire Barnes & Noble in a deal valued at $683 million, including debt. Elliott acquired the United Kingdom’s biggest bookseller Waterstones in June 2018.
Barnes & Noble is the largest bookseller in the United States with 627 bookstores across all 50 states. It had sales of $3.662 billion in fiscal year 2018.
“Physical bookstores the world over face fearsome challenges from online and digital, a complex array of difficulties that for ease and some evident reason we lay at the door of Amazon,” said James Daunt, CEO of Waterstones. “Our purpose is to create, by investment and old-fashioned bookselling skill, bookshops good enough to be a pleasure in their own right and to have no equal as a place in which to choose a book. We counter thereby Amazon’s siren call and defend the continued existence of real bookshops. We do so now with all the more confidence for being able to draw on the unrivaled bookselling skills of these two great companies.”
Barnes & Noble has been struggling to compete with Amazon. Part of the bookseller’s turnaround plan has included closing some of its more than 600 stores across the United States and relocating to smaller spaces that receive a fresh and modern look. The company has said the new “prototype” stores encourage shoppers to buy books online or from a tablet.
Waterstones is the largest bookseller in the United Kingdom with 293 bookshops, including those in Ireland, the Netherlands and Belgium. It had sales of £402 million ($512 million) in the 2018 financial year.
Paul Best, portfolio manager and head of European private equity at Elliott, added, “Our investment in Barnes & Noble, following our investment last year in Waterstones, demonstrates our conviction that readers continue to value the experience of a great bookstore.”
Elliott will own both Barnes & Noble and Waterstones, with each bookseller to operate independently. They will have James Daunt as CEO in common, and benefit from the sharing of best practice between the companies.
