Shares of the troubled electronics retailer Best Buy (BBY, Fortune 500) cratered Friday morning, after its board of directors gave founder Richard Schulze more time to shore up financing for his buyout bid.
In late August, Best Buy’s board gave Schulze a Dec. 16 deadline to come up with a reasonable offer. The two sides have now agreed to push the deadline for a fully-financed bid to Feb. 28 in order to give Schulze and potential private equity backers time to see how Best Buy fares during the holiday season.
“Both parties believe that allowing Mr. Schulze to bring his offer after the holiday season and fiscal year end is in the best interests of shareholders,” the company said in a statement. Once Shulze makes his offer, Best Buy’s board will have 30 days to review it.
Best Buy’s stock dropped 15% Friday, a day after rallying 16% on reports that a bid in the range of $5 billion to $6 billion was imminent.
Now investors are wondering whether Schulze can actually line up private equity sponsors willing to back a bid.
‘It is disingenuous to accuse everyone who calls for restructuring as trying to break up the county. History tells us that that kind of cheap blackmail will not work as long as the underlying reasons for the agitations persist.’
‘The biggest challenge seems to be that we seem to be allowing moderate voices on this issue to be drowned out by the reckless utterances of a few rabble rousers on all sides who may be tools in the hands of those who do not wish this country well. These are some of the people who arrogate to themselves the toga of spokespersons of our diverse groups.’
-Ex VP Atiku Abubakar on Restructuring.
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