Investors cheered the news that G Asset Management, a private equity firm has offered $22 per share for the struggling bookseller.
This news was confirmed by Barnes & Noble’s representatives.
It has also been reported that G Asset Management is interested in Barnes & Noble’s Nook division and has offered $5 per share for a 51% stake in that segment.
But I wouldn’t get carried away just yet.
It doesn’t seem as if Barnes & Noble’s representatives believe that G Asset Management is serious with its offer. There are also questions whether G Asset Management can even come up with the money to close this deal.
G Asset Management certainly isn’t backing off. This is new offer is $2 per share more than their initial proposal last November.
The question is, what do they see in Barnes & Noble that the rest of the market does not?
Len Riggio, Barnes & Noble’s chairman, who owns close to 30% of the company’s stock, believes he can get a much sweeter deal than the one(s) currently on the table. He does not want to sell.
[Read: Groupon Get a Raw Deal]
I can’t say that I agree with him at this point – not when Nook sales took a nosedive of more than 60% this past holiday season compared to the year before.
That entire segment has been hurt by layoffs. Not to mention, the dominance to Apple‘s (NASDAQ: AAPL) iPad and Amazon‘s (NASDAQ: AMZN) Kindle devices.
It’s a mystery why anyone is willing to offer anything at this point Barnes & Noble.
On Wednesday, Barnes & Noble is due to report earnings, and according to John Tinker, Maxim Group analyst, he quarter could “prove to be a key inflection point.”
Next week will certainly be interesting. And suffice it to say, Barnes & Noble’s earnings report should make for a compelling read.