4 Min Read
By Liana B. Baker
Feb 27 (Reuters) - Liberty Media Corp, which holds a large stake in Barnes & Noble, said on Wednesday it has the power to block a sale of Barnes & Nobles retail stores and it is waiting to see whether the bookseller's chairman Leonard Riggio will make an offer.
Liberty Media, controlled by cable pioneer and billionaire John Malone, owns preferred shares, that, if converted, would give it a 17 percent stake of bookseller Barnes & Noble. Its CEO Greg Maffei spoke about Barnes & Noble on a conference call following Liberty's fourth-quarter results.
On Monday, Barnes & Noble said its chairman, Leonard Riggio plans to make an offer for the company's bookstores in a deal that would split the stores off from the company's Nook device and e-book business. [ID: nL4N0BP49M]
Maffei, the Liberty CEO, said on a conference call with investors that his company "has a fair amount of rights to influence or block any sale that we don't see as advantageous" and that it is waiting to see if a transaction occurs. Liberty's preferred shares come with voting rights.
Maffei emphasized that the situation is fluid and that he is not certain what Riggio will do.
"No offer has been made ... It's very preliminary and we'll see where Len (Riggio) goes with that," Maffei said.
Riggio, who owns nearly 30 percent of Barnes & Noble, has not yet disclosed how much he would offer for the stores.
Barnes & Noble had put itself up for sale in 2010, but its only offer came from Liberty. Liberty, however, backed down from an initial $1 billion bid and instead bought $204 million in preferred shares convertible for $17 apiece.
Besides its investment in Barnes & Noble, Liberty has a number of stakes in other companies, including Sirius XM, which it became the majority owner of in January. Liberty and Sirius had been engaged in a prolonged battle for control that led to the departure of Sirius XM's CEO late last year.
Jim Meyer, a longtime executive at the satellite radio provider, was named interim CEO in January and given a spot on Sirius XM's board of directors.
Maffei said the search for a new CEO is ongoing and could last another few months, as the search committee reviews strong internal and external candidates. He said the ideal CEO would have experience with a subscription model, a technology background, direct marketing prowess and also understand the content and talent side of the business.
Liberty has previously said that Meyer is one of executives being considered. On the call, Maffei said Meyer had been articulate at an investor conference earlier in the week.
Maxim Group analyst John Tinker said he was surprised the search process has taken so long and said he thinks Meyer is still a front runner.
"The subscriber model is very dear to Liberty's heart and with Meyer's experience in that, he's certainly ticked all the boxes," Tinker said.
Liberty has been tweaking its portfolio in recent months. Liberty spun off the premium TV cable network Starz in January. Starz beat analysts' fourth-quarter estimates on Wednesday.
Liberty has also increased its stake in concert promoter Live Nation to about 27 percent. Maffei said in a statement that it was pleased in the growth of ticket sales at Live Nation for 2013.
Liberty's revenue fell 52 percent to $467 million, compared to $973 million a year ago.
The company said its operating income was $25 million, compared to $293 million a year ago.
Liberty shares were flat at $105.55 per share after the market closed while Barnes & Noble shares were also flat at $15.23.