Best Buy talks end, source says; adjusted profit falls

Reuters

Best Buy Co and founder Richard Schulze have ended their talks after Schulze and private equity investors sought three board seats in exchange for taking a minority stake in the company, a source familiar with the matter said on Friday.

Separately, the world's largest consumer electronics chain posted quarterly results. Best Buy lost $409 million, or $1.21 per share, in the fourth quarter ended February 2, compared with a loss of $1.82 billion, or $5.17 per share, a year earlier.

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On an adjusted basis, earnings from continuing operations fell to $1.64 per share from $2.18 a year earlier.

Revenue rose just 0.2 percent to $16.71 billion.

Schulze, who had made an informal proposal to buy Best Buy for $24 to $26 a share last August, failed to line up necessary debt and equity financing, the source said.

The founder's efforts to negotiate a deal with private equity firms Cerberus Capital Management LP , TPG Capital and Leonard Green & Partners have also come to an end, the source said.

The development would appear to end a months-long quest by Schulze to take private the company he founded in 1966, and free Best Buy to focus on its turnaround.

Schulze said in August he could acquire Best Buy for $24 to $26 per share, valuing the deal between $8.16 billion and $8.84 billion, or as much as $10.9 billion, if debt was included.

(Reporting by Dhanya Skariachan; Editing by Jeffrey Benkoe)