Microsoft Dumps $300M Into Barnes & Noble Subsidiary Valued At $1.7B
Barnes & Noble no longer needs to fear the exorbitant resources of Silicon Valley behemoths Amazon and Apple: Today, Barnes & Noble announced today it will be forming a strategic partnership with Microsoft by creating a new subsidiary, which has not been named yet, that will aim to accelerate the transition to digital publishing and significantly boost e-book sales.
Microsoft has invested $300 million into the new subsidiary, which puts the new company's post-money valuation at $1.7 billion. Microsoft's investment will give it approximately 17.6 percent equity stake. The new subsidiary will bring together all of Barnes & Noble's existing Nook businesses and its existing educational College business division.
The valuation of the new company is remarkably higher than Barnes & Noble itself, which currently has a market cap of $1.34 billion. Microsoft, on the other hand, has a market valuation of $268.95 billion.
- FOLLOW US
- Follow @ibtimesindia
The two companies appear to have put former legal complications behind them. "Barnes & Noble and Microsoft have settled their patent litigation, and moving forward, Barnes & Noble and Newco will have a royalty-bearing license under Microsoft's patents for its NOOK eReader and Tablet products," said Microsoft in a written statement. "This paves the way for both companies to collaborate and reach a broader set of customers."
The most immediate benefit for consumers will be the inclusion of a Nook application that will run on Windows 8 says today's press release. The partnership has been interpreted as a way for Microsoft to get more content onto its platform -- Windows 8 -- especially e-books, which are easily available on both Android tablets such as the Amazon Kindle Fire and Apple iOS tablets such as the Apple iPad.
To contact the editor, e-mail:
- Top High-End Tablet PCs Available in the Indian Market
- Apple Inc iOS Still Going Strong in North America, Analysts Think AAPL Stock Undervalued
- Apple Inc Target of Harsh Criticism for Refusing to Unlock iPad of Dead Mum
- Xbox One March Update: Microsoft Rolls Out New Update in Preparation for Titanfall Release; List of Improvements
- Nokia Lumia Martini: Windows Phone Blue Handset To Appear at Nokia's April 19 Event?
- Does Windows Phone 8.1 Find A Killer App In Cortana?