Company founder Richard Schulze has offered to buy all of the company's shares (he already owns 20.1% of them), making the company private again. Schulze said he wants to pay between $24 and $26 per share for Best Buy, which represents a 36 percent to 47 percent premium over the company's Friday closing stock price.
Based on Best Buy's 339.9 million outstanding shares, the offer values the company at $8.16 billion to $8.84 billion.At $26 per share, he would pay a total of about $6.9 billion for the rest of the company.
The former executive said he would have preferred to pursue a deal privately, but a deal needs to happen quickly.
"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," Schulze said in a statement.
In his letter to Best Buy's board, Schulze said he's developed a plan to deal with the company's challenges and has talked with private equity firms. Schulze said he would finance the deal through a combination of private equity investments, about $1 billion of his own equity and debt.
Right now, Best Buy is going to cut jobs. They are going to cut 600 jobs from their "Geek Squad" tech support division, and 1800 other jobs in their stores. They are also planning to close 50 more of its stores, which they have done before. They were previously planning to close big stores that were not getting much sales, and instead build smaller stores, which would cost less to operate.
As for their products, Best Buy is currently focusing on their mobile phone department. They are also combating "show rooming" of its stores, an act where consumers browse their stores for products, but end up buying them online for (most likely) cheaper prices.
