Liberty Media Invests $204 Million in Barnes & Noble

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Instead of buying a planned 70 percent stake, John Malone's company got preferred stock that could be converted into a 16.6 percent stake in the book retail giant.

NEW YORK - John Malone's Liberty Media has invested $204 million in Barnes & Noble via preferred stock that could be converted into a  16.6 percent stake in the book retail giant.

The bookseller said that with the investment, talks about Liberty Media's proposal earlier this year to acquire a 70 percent stake in Barnes & Noble for $17 per share, or slightly more than $1 billion, have ended.

Liberty bought newly issued preferred shares that are convertible into 12 million common shares at a price of $17 each. It will be able to vote on matters submitted to B&N shareholders on an as-converted basis.

“We are excited about Barnes & Noble’s prospects as the leading bookseller in the U.S. and its growth opportunities in the digital world,” said Greg Maffei, Liberty Media’s president and CEO. “This investment provides Barnes & Noble with capital to grow its business on terms that are attractive for both parties and allows us to play a meaningful role in shaping their success to generate returns for our shareholders and theirs.”

Liberty will be entitled to elect two nominees to the company's board, which will be expanded to 11 members. They will be Maffei and Mark Carleton, senior vp at Liberty.

Said Leonard Riggio, chairman of B&N: “We could not have found a better strategic investor than Liberty Media. Their investment is a strong endorsement of our overall business and the additional capital will further fuel the explosive growth of our digital strategy.”


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