Barnes & Noble (BKS) Settles With Burkle As It Focuses On a Sale
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Barnes & Noble Inc. (NYSE: BKS) will settle the lawsuit filed by investor Ron Burkle to avoid a proxy battle and to concentrate on the sale of the company, according to a report from The Wall Street Journal citing people familiar with the situation.
According to the report, the book seller will add two independent directors to its board and add another seat for an affiliate Yucaipa Cos., Burkle's firm.
A report from the New York Times said that if there is no deal agreed upon, Burkle could begin his proxy fight as early as Thursday morning.
The lawsuit was filed by Burkle to challenge the legality of a “poison pill” plan used by Barnes & Noble to stop the investor from buying more shares of the company. The strategy would prevent any investor from buying up more than a 20 percent stake in the company without the approval of its board.
If the deal is reach, Burkle will reportedly end his proxy fight for board seats of the company and support Barnes & Noble's decision to seek strategic alternatives for the company, according to the sources cited by the Journal.
As a part of the deal, Barnes & Noble will cover the Yucaipa banking and legal expenses, which sources estimated to be in the range of $10 million to $15 million, and Burkle’s firm will be represented on the special committee overseeing the potential sale of the company.
Barnes & Noble announced in early August that the company is up for sale, which was seen as a move to force the hand of Burkle.
Shares of Barnes & Noble are down 3 cents to $14.45 in premarket trade on Wednesday.
According to the report, the book seller will add two independent directors to its board and add another seat for an affiliate Yucaipa Cos., Burkle's firm.
A report from the New York Times said that if there is no deal agreed upon, Burkle could begin his proxy fight as early as Thursday morning.
The lawsuit was filed by Burkle to challenge the legality of a “poison pill” plan used by Barnes & Noble to stop the investor from buying more shares of the company. The strategy would prevent any investor from buying up more than a 20 percent stake in the company without the approval of its board.
If the deal is reach, Burkle will reportedly end his proxy fight for board seats of the company and support Barnes & Noble's decision to seek strategic alternatives for the company, according to the sources cited by the Journal.
As a part of the deal, Barnes & Noble will cover the Yucaipa banking and legal expenses, which sources estimated to be in the range of $10 million to $15 million, and Burkle’s firm will be represented on the special committee overseeing the potential sale of the company.
Barnes & Noble announced in early August that the company is up for sale, which was seen as a move to force the hand of Burkle.
Shares of Barnes & Noble are down 3 cents to $14.45 in premarket trade on Wednesday.
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