Best Buy Founder Richard Schulze to Proceed with Due Diligence to Take the Company Private
August 28, 2012 8:53 AM
comment(s) - last by
Schulze has 60 to offer a purchase proposal
Retail electronics giant Best Buy has been going through some rough times as the company faces increasing pressure from online and discount retailers such as Amazon and Walmart. Best Buy founder Richard Schulze
about a month ago that he was considering an attempt to take Best Buy private with private equity or possibly selling his 20% stake in the company.
The Best Buy board and Schulze have announced that they have reached an agreement that will permit Schulze to form an investment group and conduct due diligence needed to make a fully financed proposal to acquire Best Buy. The agreement establishes a non-exclusive, orderly process with Schulze and has been filed with the SEC.
The agreement allows Schulze to perform immediate due diligence with access to non-public company information to be shared with advisors and potential private-equity partners. Under the terms of the agreement, Schulze will be allowed to bring forward a fully financed and definitive proposal within 60 days of the beginning of the due diligence period. The due diligence period can also be extended in certain circumstances.
Schulze has also agreed that if his proposal is rejected by the Board of Directors, he will not pursue an acquisition until January 2013. At that time, Schulze will have the opportunity to make a second offer if the original is rejected. The
Wall Street Journal
reports that Schulze has previously publicly announced that he was proposing a $10 billion buyout of the company he helped found and that his financial partners were "highly confident" that the money to purchase the company could be raised.
Best Buy has also announced that it will offer Schulze two seats on the company's board reflecting the 20% of the company he owns. However, the two seats could be withdrawn if Schulze decides to make a purchase offer directly to shareholders or violates standstill provisions of the agreement.
Wall Street Journal
This article is over a month old, voting and posting comments is disabled
8/28/2012 4:42:11 PM
They don't have to match
online prices. They just have to match or beat
. Then while you're in the store to buy that sale item, you notice the router and LAN cable you also needed for only $3 more than online. And since it's right there in front of you and you've already paid for the gas to get there, you pick those up too.
The problem for Best Buy is that they charge like $20 for a $3 cable. Frys doesn't do that as much. Most of the stuff I see there is priced pretty close to online prices, and their sale prices frequently beat online prices. So they remain in business.
8/29/2012 9:56:37 AM
This strategy is as far as I can tell very successful for MicroCenter. They sell you a CPU/Motherboard at a loss, but make up for it on other items such as Memory, Cases, PSUs, HDDs, etc. If you go into MicroCenter, at least the two I have been in, they actively advertise the Newegg and TigerDirect prices for CPUs as well as Motherboards, but not for the products where MicroCenter's price is higher. I imagine they must get a decent price on CPUs and Motherboards, since they seem to stock a limited variety of each, but in extreme quantities, at the stores I have shopped in. I also enjoy the fact that their salespeople, while not necessarily the brightest, are not trying to push cell phone upgrades or satellite TV service on me when I shop there.
"What would I do? I'd shut it down and give the money back to the shareholders." -- Michael Dell, after being asked what to do with Apple Computer in 1997
Best Buy Founder Looks to Go Private with Help of Former Execs
July 31, 2012, 5:42 PM
WebOS Class Action Settlement Costs HP $57 Million
April 1, 2014, 10:22 AM
IBM Workers Strike Over Terms of Deal That Will Have Them Working for Lenovo
March 6, 2014, 9:29 AM
Google Picking Up Artificial Intelligence Company "DeepMind" for $400 Million
January 27, 2014, 9:25 AM
Quick Note: Qualcomm Grabs up Palm, IPAQ, and Bitfone Patent Portfolio from HP
January 24, 2014, 9:18 AM
Verizon Buys Intel Media OnCue Cloud TV assets
January 21, 2014, 10:26 AM
Google's First Asian Data Centers Now Operational
December 11, 2013, 8:50 AM
Most Popular Articles
A Bug's Life: Female Cave Bugs Have Penises, Penetrate Males for Three Days
April 17, 2014, 7:20 PM
HTC Hires Former Samsung Marketing Chief Who Developed "Galaxy" Brand
April 18, 2014, 6:00 PM
NASA Finds "Habitable Zone" Planet Sized Similar to Earth
April 18, 2014, 3:13 PM
Mounties Arrest 19-Year-Old Who Delayed Canada's Tax Filing w/ Heartbleed
April 17, 2014, 3:24 PM
Thanks to Government Crackdown, Chinese "Porn Cop" Has Watched 600K Adult Videos
April 21, 2014, 12:00 PM
Latest Blog Posts
Space Terrorism is a Looming Threat For the United States
Apr 23, 2014, 7:47 PM
Facebook Aims to Provide Internet to "Every Person in the World" with Drones, Satellites
Apr 1, 2014, 10:20 AM
Retail Mobile Sites Experience Outages in Light of Simplexity's Bankruptcy
Mar 14, 2014, 8:48 AM
Tesla vs. BMW: Who Has the Safer EV?
Feb 1, 2014, 2:56 PM
Justice Leaks Details of Next HTC One Two Flagship Phone
Dec 5, 2013, 4:04 PM
More Blog Posts
Copyright 2014 DailyTech LLC. -
Terms, Conditions & Privacy Information