On the fourth and final day of testimony in Ron Burkle’s Yucaipa Delaware court suit challenging Barnes & Noble’s poison pill, board director Michael del Giudice testified that any investor holding more than 20 percent of the book seller’s shares decide to vote against the poison pill at the annual shareholder meeting in November, that move would itself would trigger the pill. “If they have an agreement or understanding to do so, that’s the problem,” said Del Giudice. But when pressed to define what, exactly “the problem” was that could trigger the pill, Del Giudice was more vague: “I don’t […]
Finance
Borders Will Sell Paperchase for $31 Million in Debt-Reduction Measure
Borders has agreed to sell its Paperchase stationery unit for $31 million to Primary Capital, a UK-based private equity firm. Under the agreement, set to close next week, Borders will continue to purchase and sell Paperchase products in its stores, and use $25 million of the proceeds to reduce the amount outstanding under its $90 million term loan credit facility, as specified under the terms of the loan agreement reached this past April. The deal comes just a month after Borders laid off an unspecified number of Paperchase staff, its third round of job cuts in 2010, and six years […]
BN Trial Zeroes in on Possible Burkle-Aletheia Alliance
On day three of the case brought before Delaware court by Ron Burkle’s Yucaipa challenging Barnes & Noble’s poison pill, testimony from expert witnesses finally delved into what’s been openly speculated about for months: if Burkle is able to wage the proxy fight he wants at the upcoming annual meeting this fall, it would hinge on an alliance between Yucaipa, and its more than 19% stake in BN, and the next-largest stockholder, money management firm Aletheia Research & Management, with a more than 16% stake in the company. Testifying on behalf of Yucaipa, CEO of MacKenzie Partners Inc. Daniel Burch […]
Riggio Contradicts Himself on the Stand
Testifying Friday in a Delaware courtroom in the case brought by Ron Burkle’s Yucaipa challenging Barnes & Noble’s poison pill, chairman Len Riggio said of the defense plan adopted by the board, “It’s about the company.” But in a videotaped deposition before the trial played in court, Riggio said “the pill was about me and my family.” At another point in the deposition, he said, “I have a strong preference for being the largest shareholder of Barnes & Noble, being its founder.” Riggio was vaguer on the point raised in the first day’s testimony by Barnes & Noble board member […]
Lively Testimony at BN Trial
Coverage of the first day of testimony in Ron Burkle’s lawsuit against Barnes & Noble in Delaware makes for fascinating, if not crystal clear, reading. Burkle indicated that he considered–but then rejected–a buyout bid for BN last year at $25 a share. (The stock now trades for under $13, its lowest point in years.) He accumulated stock last fall because he thought the company was historically cheap–“This was one of those things you would look back on and say ‘this could never happen again'”–but on that point he’s already been proven wrong by the market. Burkle is considering nominating his […]
Borders Shareholders “Asked” to Give LeBow Control Over Management
As expected, Borders announced a September 29 shareholders meeting to rubber-stamp the company’s deal with Bennet LeBow. He will either be granted a whopping stock warrant for 35.1 million shares exercisable at $2.25 or he will get “stock appreciation rights” that pay him anyway if the stock moves above that price. The surprise is the second motion on the agenda, which gives LeBow’s company control over the hiring and firing of the ceo, cfo, and any other executive officer. That should clear things up for anyone who still had doubts about whether LeBow bought complete control of the company.Release