With Microsoft having “invested” $300 million in Barnes & Noble’s Nook Media (Nook hardware, online bookstore, e-book, and college bookstore operations) in 2012 for a 17.6% stake, the hapless Microsoft is taking a ~$185 million loss.
“The bookstore retailer bought out Microsoft’s preferred interest in Nook for about $120 million in cash and stock, freeing Microsoft from further investments in the business,” Chelsey Dulaney reports for ADVFN. “Barnes & Noble, struggling to adapt as book buyers migrated to online retailers like Amazon.com Inc., said Thursday that it expects the planned split of its Nook Media unit from its retail stores to occur by the end of August, behind its initial projection for a separation by March.”
“Microsoft invested in Nook in 2012, pledging more than $600 million to help prop up Barnes & Noble’s digital-reading business. In return, Barnes & Noble committed to creating e-reading apps for new computers, phone and tablets powered by Microsoft’s Windows software. But since the deal was struck, circumstances for both companies have changed. Barnes & Noble slowed work on its e-reading devices and tablets as its sales slumped and laid off much of the workforce devoted to its Nook devices,” Dulaney reports. “Meanwhile, Microsoft, which has its own Windows tablets and smartphones, shifted its consumer-device strategy following sales hiccups. The companies scaled back their partnership earlier this year, allowing Barnes & Noble to stop developing the Nook e-reading app for devices powered by Microsoft software.”
Read more in the full article here.
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