Barnes & Noble Considering Sale or Spin-off of Nook Business

Posted on January 5, 2012

Barnes & Noble Inc. has announced it is considering selling or spinning off its Nook business. This is shocking because the Nook enables the book retailer to compete with and Apple in the booming electronic book business. Barnes & Noble becomes just an ordinary book retailer with no technology counterpart without the Nook.

William Lynch, chief executive of Barnes & Noble, said in a statement, "We see substantial value in what we've built with our Nook business in only two years, and we believe it's the right time to investigate our options to unlock that value."

Barnes & Noble also announced that it sold less Nook devices than expected over the holidays and reduced its full-year sales forecast for its Nook business. Barnes & Noble is unable to afford the increasing costs needed to compete with and Apple in ebooks and expand internationally. The company's only option appears to be to separate the Nook business and take on new partners. The Wall Street Journal reports that Barnes & Noble is talking to strategic partners, but no names were given.

Reuters reports that Barnes & Noble's stock plunged over 20% on the news.

Barnes & Noble also announced yesterday that it plans to sell Sterling Publishing.

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