Standard & Poor has downgraded Barnes & Noble stock from “hold” to “strong sell”, noting that B&N shares “have risen about 40% over the past 3 months and are now trading well above” S&P’s target price. The firm also expects further weakening in sales over the next fiscal year and is “also concerned by the long-term trend of declining adult readership levels.” B&N’s Board of Directors also declared a quarterly cash dividend of $0.25 per share, payable on March 31 to stockholders of record at the close of business on March 10.Business Week
Finance
Borders Deadline Extended Again
Borders Group is paying Pershing Square $750,000 for “reimbursement of expenses” and the extension of the “put” to require Pershing to buy their Paperchase subsidiary, as both the option and the expiration of Pershing’s $42.5 million loan are extended for a second time, until April 15. Borders will report earnings for the fourth quarter and full year on March 31.
Investment Firm Declares Big BN Stake
Arnhold and S. Bleichroeder, LLC (ASB)’s First Eagle Global Fund has accumulated a big chunk of Barnes & Noble stock. An SEC filing declares that the fun controls 11.7 percent of the bookseller’s shares, and with additional interests on behalf of clients their stake of more than 7 million shares comprises 12.77 percent of BN shares.
Cheetham Quits Quercus
Non-executive chairman of Quercus Publishing Anthony Cheetham has stepped down, and director David Potter is taking over his post as interim chairman. Cheetham tells the Bookseller “Since assuming a non-executive position, I have felt less comfortable with my role in the company and with some of the key decisions adopted by management.” The company’s ability to continue its rapid expansion ran up squarely against the credit squeeze. “I felt standing still was not the wisest option,” Cheetham says. Co-founder Mark Smith says “We’re in the middle of a deep recession – we need to step back a little on our […]
Another Credit Rating Cut for HMH
Standard & Poor’s Ratings Services lowered their debt ratings on Education Media & Publishing Group and its Houghton Mifflin Harcourt Publishers to CCC from B-. They note “the rating outlook is negative…. In addition, we revised the recovery rating on Houghton Mifflin’s first-lien credit facilities to 3, indicating our expectation of average (50% to 70%) recovery for lenders in the event of a payment default, from 2.”Summary
Harper Children's to Close Bowen Line
In another paring at HarperCollins, Susan Katz announced that “to further streamline our publishing operations, we will close The Bowen Press.” Katz says “as the book world becomes increasingly challenging, we must continue to be extremely cost conscious.” The unit will also move offices, to join the rest of Harper at 10 E. 53 street. Spokesperson Eric Crum says there is no firm date for the move yet, since they are upgrading the offices first.