Shares of struggling electronics retailer Best Buy, Inc. (BBY) traded up by as much as 7.7 percent today before settling in to close at $17.87 as the company’s Board of Directors agreed to open up its books to former Chairman and founder Richard Schulze and his investment group as they plan to buy the company and take it private.
Last month, Schulze said he could pay as much as $26 per share for the company, which would represent a hefty premium based on where the stock is currently trading. However, the potential deal is still in the early stages as Schulze will need to examine Best Buy’s financials to determine an offer. Schulze’s group will have 60 days to offer a bid and then until January 2013 to offer a second offer if the initial one is rejected by the company’s board.
Schulze, who announced his resignation as chairman of the company in May during a scandal involving former CEO Brian Dunn and a female employee, currently owns 20 percent of Best Buy’s stock.
The retail chain, which was a top performer only a few years ago, has had a difficult time adjusting to the tough economy and evolving consumer trends and shopping habits. Best Buy’s stock price has fallen roughly two-thirds from where it was two years ago.
The company has placed its turnaround hopes in the hands of Hubert Joly, who will start as CEO in September. Joly, who is receiving a hefty compensation package to take the reigns, is viewed as a turnaround expert with high level executive experience at Vivendi Universal Games and Carlson Wagonlit Travel. But whether he’ll have the chance to implement any meaningful changes before the potential takeover may be out of his hands.