You are being directed to ZacksTrade, a division of Zacks & Company and licensed broker-dealer. ZacksTrade and Zacks.com are separate but affiliated companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
|No Recent Quote currently available|
My Portfolio Tracker
One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts. Set yours up today.
Dec 13, 2012 (Star Tribune (Minneapolis) - McClatchy-Tribune Information Services via COMTEX) -- Best Buy Co. founder Richard Schulze will make a fully financed offer to purchase the consumer electronics giant by the end of the week, possibly on Friday, the Star Tribune has learned.
Schulze will submit a formal proposal to the board of directors before a "hard" deadline of Sunday, said one source. The offer is expected to be at least $5 billion to $6 billion.
"This is going down to the wire," the source said.
Over the past weekend, Schulze and his team secured agreements to finance the deal from bankers and private equity investors, which includes Cerberus, Leonard Greene & Partner and the Texas Pacific Group, the source said. Schulze will meet with his top advisers, including former CEO Brad Anderson and former president Al Lenzmeier, in Minnesota on Thursday and Friday as they prepare to move forward.
Best Buy declined to comment on Wednesday.
Founded by Schulze as a single store in St. Paul in 1966, Best Buy has grown into a global retail powerhouse with more than $50 billion in annual sales and more than 100,000 employees.
While it remains unclear how much Schulze will offer for the company, investors expect the bid to be much lower than the range of $24 to $26 per share that Schulze first outlined over the summer. Since late June, Best Buy stock has fallen 45 percent, closing Wednesday at $12.20 per share.
The recent stock plunge surprised Schulze so much that he requested a 30-day extension from the original deadline of mid-November to see how Best Buy's holiday numbers would hold up, sources said.
At this point, institutional investors and analysts speculate that shareholders would be open to selling their stake to Schulze, although they would prefer at least $17 per share, a 40 percent premium over the company's current stock price. In after hours trading Wednesday, Best Buy stock jumped 3.6 percent.
Now that Schulze appears ready to make a credible bid, the big question will center on how the board responds to the offer. Under the original negotiating terms between Schulze and Best Buy, Schulze can make a second offer in January if the board rejects his initial bid. Indeed, a source close to Schulze previously told the newspaper that he expected the board to say no the first time.
Schulze's relationship with the company has improved considerably over the past several months after a tense parting earlier this year.
In May, the Best Buy board, led by G. "Mike" Mikan, forced Schulze to resign as chairman after it determined the founder withheld information about allegations that then CEO Brian Dunn had an affair with a female employee.
At the time, much of Wall Street believed Mikan, who was named interim CEO, would get the job permanently. But in a surprise move, Best Buy in September named Hubert Joly, a former Carlson CEO with close ties to Anderson, as its new leader.
Joly has since worked hard to improve Best Buy's relationship with Schulze. At the behest of the board, Joly had arranged for Schulze's buyout team to speak to executives throughout the company. Joly also kept Schulze updated about key hires, including Sharon McCollam as chief financial officer and Shawn Score as U.S. retail chief.
Joly also has publicly praised Schulze several times to analysts and reporters. Last month, Joly met with Schulze, Anderson, and Lenzmeier to discuss turnaround strategies.
Thomas Lee --612-673-4113
___ (c)2012 the Star Tribune (Minneapolis) Visit the Star Tribune (Minneapolis) at www.startribune.com Distributed by MCT Information Services
Copyright (C) 2012, Star Tribune (Minneapolis)
As of Sunday, 12-09-2012 23:59, the latest Comtex SmarTrendA? Alert,
an automated pattern recognition system, indicated a DOWNTREND on
03-29-2012 for BBY @ $24.72.
For more information on SmarTrend, contact your market data
provider or go to www.mysmartrend.com
SmarTrend is a registered trademark of Comtex News Network, Inc.
Copyright A? 2004-2012 Comtex News Network, Inc. All rights reserved.
Zacks Research is Reported On:
Zacks Investment Research
is an A+ Rated BBB
Copyright 2014 Zacks Investment Research
At the center of everything we do is a strong commitment to independent research and sharing its profitable discoveries with investors. This dedication to giving investors a trading advantage led to the creation of our proven Zacks Rank stock-rating system. Since 1986 it has nearly tripled the S&P 500 with an average gain of +26% per year. These returns cover a period from 1986-2011 and were examined and attested by Baker Tilly, an independent accounting firm.
Visit performance for information about the performance numbers displayed above.
Real time prices by BATS. Delayed quotes by Sungard.
NYSE and AMEX data is at least 20 minutes delayed. NASDAQ data is at least 15 minutes delayed.