Activist investor pushing for another attempt at sale of Barnes & Noble

An activist investor is pushing Barnes & Noble Inc to make another attempt at selling itself, arguing the bookseller needed an owner who can invest in its beleaguered operations, The Wall Street Journal reported yesterday..

Sandell Asset Management, which started buying a stake in the New York bookstore chain recently is already among the 10 biggest investors in the company, according to people familiar with the matter.

Sandell believed the company could attract a bid of over $12 a share, as against the closing price yesterday of $7.10, according to a letter reviewed by The Wall Street Journal, due to be released today.

Even though the popularity of physical bookstores had fallen in the US in the internet age, Sandell is betting on the stores not going away, according to commentators. This would see Barnes & Noble attract a well-heeled private-equity firm or another retailer.

The company had explored several possible deals to sell or break itself up over the years, which also included a buyout attempt by its chairman, Leonard Riggio.

However, none of plans had materialised and  stock slumped 60 per cent in the past two years, with the company's market value plunging to just above $500 million.

John Malone's Liberty Media Corp proposed acquisition of Barnes & Noble for $1.02 billion in 2011, but ended up investing in preferred shares it could convert into a stake later.

Liberty sold almost all its stake in 2014 (See: Liberty Media reduces stake in bookstore chain Barnes & Noble ).