This article was published on January 5, 2012

Barnes & Noble looking to split ‘Nook’ into a separate company


Barnes & Noble looking to split ‘Nook’ into a separate company

Barnes & Noble, the largest book retailer in the US, has reportedly said that it’s considering splitting off its Nook e-reader business as a separate company, a product that has underpinned much of its growth in recent times.

William Lynch, Chief Executive Officer of Barnes & Noble, said:

“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.”

In the middle of a sales report announcement today, Barnes & Noble said that it was looking to “pursue strategic exploratory work to separate the Nook business” from the rest of the company.

“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,” said Lynch. Indeed, Barnes & Noble is predicting that its Nook business will hit $1.5bn this year.

Of course, there’s no guarantee that its Nook business will separate, and there was no timetable given for the review, whilst it said it won’t comment any further on the matter. But it is strange that it chose to publicly announce the review, which implies that an announcement is either imminent, or it’s courting buyers for the print side of its business.

During the nine-week holiday period, Barnes & Noble store sales increased 2.5% over the prior year period to $1.2 billion. Comparable store sales increased 3.4%, on top of a 9.7% increase last year. Retail core comparable store sales, defined as the sales of non-digital merchandise, increased 4.5% over last year. But, seeing the strength of its Nook sales as its future.

Barnes & Noble confirmed that it is “in discussions with strategic partners including publishers, retailers, and technology companies in international markets that may lead to expansion of the Nook business abroad”, with the UK thought to be a likely launch market some time during 2012.

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