Barnes & Noble Stock Collapses; Company Considers Spinning Off Nook Into New Company

Posted by Techvibes NewsDesk

Barnes & Noble's stock sank steeply this morning after it warned investors that red ink is flowing. The company's share price plummeted 24% in morning trading.

Now Barnes & Noble is looking at separating its Nook business, creating a new company around its electronic books and ereaders. However, B&N also noted that a "shortfall in the expected sales of Nook Simple Touch" was a driving factor in the company's losses, so is Nook any more of an appealing business to investors?

The company's brick-and-mortar book sales have been hammered by agile online competitors like Amazon, while cheap, full-featured tablets such as the Kindle Fore have put tremendous pressure on the Nook. Critics argue that Barnes & Noble simply can't compete with the likes of Apple and Amazon, although chief executive William Lynch called such claims "ridiculous."

Over at Indigo Books & Music, which owns the Chapters line of bookstores, selling Toronto-born Kobo created a $300 million windfall and a spike in the stock price. While it's not clear whether this will save the also-struggling company, it's an option B&N may want to consider—assuming they can find a buyer.

The acquisition of Kobo is a Finalist for Most Significant Canadian Acquisition of 2011 in the First Annual Canadian Startup Awards. 

Company:
Indigo Books & Music Inc.
Website:
http://www.chapters.indigo.ca
Location:
Toronto, Ontario, Canada

Indigo Books & Music Inc. is the largest book retailer in Canada operating bookstores in all 10 provinces under the names, Indigo, Chapters, World's Biggest Bookstore, and Coles. Indigo also operates chapters.indigo.ca an online retailer of books, music, movies, and more. A Canadian company based in Toronto, Ontario, Indigo provides consumers with inspiring retail and online environments for books and life... more

Company:
Kobo, Inc.
Website:
http://www.kobobooks.com/
Location:
Toronto, Ontario, Canada

Kobo is a global eReading service backed by majority shareholder Indigo Books & Music, Borders Group, REDgroup Retail, and Cheung Kong Holdings. Kobo believes consumers should be able to read any book on any device. With a catalog of over two million eBooks, and an open platform, Kobo enables retailers, device manufacturers and mobile operators to bring the joy of eReading to customers everywhere. For more... more


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Techvibes NewsDesk

Techvibes NewsDesk

Techvibes is Canada's leading technology media property.Founded in 2002, Techvibes covers technology and business news that impacts Canadians. We combine breaking local news with international coverage to deliver a unique balance of insight and information. The Techvibes Newsdesk covers a broad beat and publishes general news stories. If you have a story you would like covered, email... more



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