Under growing pressure from electronic book sales, the largest U.S. bookseller is considering selling the company.
Fresh memories of the havoc wreaked by online music downloading on bricks-and-mortar music stores, are fueling fears that online ebook downloads will destroy bricks-and-mortar bookstores. Adding fuel to that fear is the news that largest U.S. bookstore chain, Barnes and Noble, is considering putting itself up for sale.
The bookseller chain said it's considering "strategic alternatives, including the possible sale of the company". The company, whose more than 700 stores make it the largest bookseller in the US, has watched its stock decline over the past year as digital books encroach on its territory. Barnes & Noble has countered the digital book phenomenon by introducing its own ebook reader, the Nook, but it hasn't been enough to stop the bleeding.
A battle among Barnes & Noble's leading stockholders is also emerging as longtime founder and director Leonard Riggio is being challenged by new investors, who have been buying up the bookseller's stock.
"Barnes & Noble has an iconic brand and unique competitive advantages we believe will position the company to succeed over time in a rapidly changing market," the company's directors said in a prepared statement. "The board is confident in Barnes & Noble's strategy and fully supportive of the senior management team, which is delivering explosive growth in our fast-developing digital business."
Billionaire investor Ronald W. Burkle has increased his ownership stake as has investment firm Aletheia Research & Management. The firm's stock has risen in recent days as a stockholder fight has loomed.
Barnes & Noble and Borders, its chief rival, have been under pressure as ebook sellers led by Amazon which sells both its popular Kindle ebook reader as well as online books have moved into the turf of traditional booksellers. Apple's iPad also represents competition to traditional book selling. With its iTunes music service Apple led the movement that caused most large bricks-and-mortar music stores to close their doors.
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