I guess I'm not the only one who's not buying into a storybook ending for Barnes & Noble
This morning's New York Post is hearing that a deal with Liberty Media's
Shares of B&N soared three months ago, when Malone began negotiating a deal that would value the cavernous bookstore at a cool $1 billion. The stock also turned higher when rival Borders revealed that it would liquidate its remaining stores.
Having Malone step up validated the bookseller and its growing, yet unprofitable, e-reader business. From DirecTV
The Sirius XM nibble was classic, with Malone's holding company receiving what is now the equivalent of 2.7 billion shares -- worth more than $5 billion at the moment -- simply for letting the satellite radio provider borrow money at a ridiculously high interest rate.
The difference here is that Sirius XM was a company on the ropes, but with an undeniably bright future as the only game in town when it comes to satellite radio. Sirius XM turned profitable shortly after Malone's investment.
What will the future be for a chain of mammoth-sized bookstores? If Borders couldn't find a buyer willing to keep the bricks-and-mortar operator open, how will B&N fare any better as books continue to go digital?
Malone's no dummy. He knows the days are numbered on that front. The meaty angle here is the Nook, giving the buyer of B&N the only legitimate contender to Amazon.com's
However, even B&N couldn't imagine that Amazon's e-reader that originally hit the market at $399 four years ago has come all the way down to as little as $114. Amazon's margins have been crushed in recent quarters, but can a potential buyer of B&N stomach the price war that may still end badly for the Nook?
We're now likely weeks away from Amazon's debut of an entry-level tablet that may eat into the Nook Color's niche. Waiting -- in Malone's case -- is not only prudent, but likely the best way to secure an even lower price for B&N if he's still up for the challenge.
Can Barnes & Noble be saved? Share your thoughts in the comment box below.
