The stock is up about 15% this morning after the Minneapolis-based company’s home town paper, the Star Tribune, reported that founder Richard Schulze will make “a fully financed offer” of as much as $6B for Best Buy ”by the end of the week, possibly on Friday.” The potential offer contrasts with the $8.8B proposal Schulze made in August. But Best Buy shares have declined more than 20% since then as it reported softer than expected earnings — which CEO Hubert Joly said were “clearly unsatisfactory” – and lowered its financial forecasts. Bankers and private equity said to be backing Schulze include Cerberus, Leonard Greene & Partner and the Texas Pacific Group,. He’s also working with the consumer electronics chain’s former CEO Brad Anderson and former president Al Lenzmeier. Schulze, who launched the company in 1966, resigned from the board in June. That upended a face-saving deal he made with the board after its Audit Committee said in a report that Schulze helped to cover up former CEO Brian Dunn’s “inappropriate relationship” with a female employee. Corporate law in Minneapolis makes it virtually impossible to mount a hostile takeover. But Schulze’s relationship with the company is said to have warmed as its business performance cooled, in large part due to its inability to keep up with rivals including Amazon and Walmart. In August Best Buy gave him permission to proceed with an effort to bid for the company. That agreement allows Schulze to return with a second offer in January if the company rejects his first one. That’s seems likely as part of the negotiation process.
By DAVID LIEBERMAN, Financial Editor | Thursday December 13, 2012 @ 11:45am ESTTags: Best Buy, Richard Schulze
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This article was printed from http://www.deadline.com/2012/12/best-buy-stock-richard-schulze-acquisition-bid/
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