Schulze's Plans for Best Buy (BBY) are Collapsing All Around Him
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Price: $26.90 +3.86%
Overall Analyst Rating:
NEUTRAL (= Flat)
Dividend Yield: 3.1%
EPS Growth %: -33.6%
Overall Analyst Rating:
NEUTRAL (= Flat)
Dividend Yield: 3.1%
EPS Growth %: -33.6%
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Best Buy (NYSE: BBY) is trading even lower Tuesday night following reports that a takeover attempt by founder Richard Schulze might not happen after all.
And it all has to do with financing arrangements.
According to Reuters, Schulze may be failing on two fronts. Efforts to secure financing have faltered while a back up plan to line-up minority investors is also swinging in the breeze.
Schulzes new plan was to have private equity investors buy in for a non-controlling interest in Best Buy, instead of a full-on takeover like originally planned. The minority investment could have happened via a private investment in public equity (PIPE) transaction, Reuters notes. PIPEs are useful when small- and mid-cap companies have trouble raising capital in public markets.
Earlier, Best Buy postponed its fourth-quarter release until March 1st, allowing Schulze until the end of the day Thursday to submit a bid.
Shares are down about one percent in late trading.
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And it all has to do with financing arrangements.
According to Reuters, Schulze may be failing on two fronts. Efforts to secure financing have faltered while a back up plan to line-up minority investors is also swinging in the breeze.
Schulzes new plan was to have private equity investors buy in for a non-controlling interest in Best Buy, instead of a full-on takeover like originally planned. The minority investment could have happened via a private investment in public equity (PIPE) transaction, Reuters notes. PIPEs are useful when small- and mid-cap companies have trouble raising capital in public markets.
Earlier, Best Buy postponed its fourth-quarter release until March 1st, allowing Schulze until the end of the day Thursday to submit a bid.
Shares are down about one percent in late trading.
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