Pakistan News & Features Services
Barnes & Noble (B & N) has announced an $89.5 million investment in its Nook Media subsidiary while also forecasting the holiday sales to fall below expectations. They also anticipated that the results in its Nook business will not meet forecasts for fiscal 2013.
According to reports, Pearson’s investment will allow the company a 5% stake in Nook Media making them the third investor in the venture as B&N’s stake will slip to 78.2% and Microsoft’s stake will become 16.8%.
Under the agreement, Pearson also received warrants to acquire another 5% of the company based on a valuation of $1.789 billion and subject to certain conditions.
In a statement, B&N CEO, William Lynch, and Pearson North America Head, Will Ethridge, both expressed their excited about the partnership. In a regulatory filing, B&N said that with the agreement, Nook Media would begin distributing the content of Pearson, regarded as the world’s largest educational publishing company with substantial assets in both the higher education and el-hi markets.
“With this investment we have entered into a commercial agreement with Nook Media that will allow our two companies to work closely together in order to create a more seamless and effective experience for students," Ethridge was quoted as saying.
"It is another example of our strategy of making our content and services broadly available to students and faculty through a wide range of distribution partners," he added.
B&N haven’t said much about the weaker than expected holiday sales. Thanksgiving weekend sales got off to a good start with unit sales of Nook devices double that of the previous year. Yet B&N was expecting a slight dip in sales in its trade stores.