Best Buy’s founder and former chairman, Richard Schulze, has made an offer of $8.8 billion to privatise the company.
According to Business Week, the retail giant has been struggling in a market where customers increasingly use it as a showcase before actually making the purchase online from rival e-tailers,
Best Buy posted a net loss of $1.23 billion in the last financial year and was forced to close 50 big box stores in the United States.
Schulze is apparently making an offer of $26 per share, which represents a 47 per cent premium over the share prices at the time. He will invest $1 billion of his own money and the rest will be raised from investors and private equity firms.
However, the offer has reportedly been met with scepticism among investors. The announcement nudged the share price up to just under $20 but not reaching the proposed offer, which in turn caused Standard and Poor’s to downgrade Best Buy’s credit rating as the buyout would add debt to its books.
Nonetheless, Shulze appears adamant that the deal must go through.
“There is no question that now is the moment of truth for Best Buy and that immediate and substantial changes are needed for the company to return to its market-leading ways,” said Mr. Shulze in a statement.
“I am deeply concerned that further delay and indecision will cause additional loss of both value and talented leaders who are now uncertain of the company’s future.”