G Asset Offers To Acquire Controlling Stake In Barnes & Noble

(RTTNews) - G Asset Management LLC, a private investment firm, has offered to acquire a controlling stake in struggling U.S. bookstore chain Barnes & Noble Inc. (BKS) for $22 a share.

Following the announcement, shares of Barnes & Noble gained about 6 percent in late noon trade on the New York Stock Exchange.

G Asset said its proposal is sweeter than a earlier offer in November when it valued Barnes & Noble at $20 a share. The $22 per share proposal was made on Thursday night - implying a 30 premium to Barnes & Noble's current market price.

G Asset also offered an alternative with an offer to buy 51 percent of the Nook segment, which includes the tablet, content and accessories, valuing the unit at $5 per share.

G Asset believes that substantial shareholder value would be created if the struggling Nook segment is separated from the profitable retail and college business. Both offers are subject to the obtaining of financing, due diligence and the inking of definite agreements, among other conditions.

G Asset earlier recommended commencing a rights offering for the Nook segment to existing shareholders.

Barnes & Noble has been trying to rejuvenate the Nook business despite heavy investments as the tablet market continues to be dominated by Apple Inc.'s (AAPL) iPad.

On Feb. 10, shares of Barnes & Noble climbed around 9 percent on reports it eliminated positions in its Nook digital books and e-reader business. The job cuts pertained to a team of hardware engineers.

In January, the bookseller said Nook segment revenues plunged 60.5 percent to $125 million for the nine-week holiday period.

In the same month, Barnes & Noble announced the promotion of Nook Media head Michael Huseby as chief executive officer. The position was vacant since June when then CEO William Lynch resigned after a pallid fourth-quarter performance.

BKS is trading at $17.78, up $1.00 or 5.96%, on a volume of 8.3 million shares. In the past year, the stock has traded in the range of $12.59 - $23.71.