Richard Schulze, Founder and former Chairman of Best Buy Co., Inc. BBY, today sent a letter to the Best Buy Board of Directors requesting
permission to form a group and conduct basic due diligence so that he can
present a fully financed offer for the company. The letter follows:
August 16, 2012
Board of Directors
Best Buy Co., Inc.
7601 Penn Avenue South
Richfield, MN 55423
Ladies and Gentlemen:
This is a critical time for Best Buy. The decisions that you make over the
next few days and weeks may well determine the fate of this great company. As
such, the Board has a duty to ensure it is fully informed about all available
options as it seeks to achieve the best outcome for Best Buy and its
shareholders.
On August 6, after repeated requests to the Board to provide me with due
diligence information and the consent to form a group required under Minnesota
law, I made public my proposal to acquire all of the common stock of Best Buy
for $24.00 to $26.00 per share in cash. In response, you dismissed my
carefully considered proposal as a “highly conditional indication of
interest.” I would have preferred to have a constructive private dialogue with
the Board, but once having made my proposal, I was required as a 13D filer to
make it public.
You can easily test how real my proposal is by granting me permission to form
a group and by providing basic due diligence information necessary to present
a fully financed offer and allow shareholders the opportunity to receive a
substantial cash premium for their shares.
I am deeply concerned about the direction of the company and, as Best Buy's
largest shareholder, I cannot simply stand aside. I still hope to work with
the Board on a mutually beneficial transaction – but you should know that I am
not going away.
All I am asking is your permission to conduct due diligence and form a group
so that I can quickly be in a position to give the Board a fully financed
offer for your consideration. My need for due diligence is limited to
financial data and the standard corporate information necessary to secure
financing. There would be no burden on management as I do not need any
presentations to me or potential partners interested in investing with me in
Best Buy. I am confident due diligence can be completed quickly.
The transaction I have proposed would be financed through a combination of
private equity investment, my own substantial equity investment and debt
financing. A number of leading private equity firms have informed me that they
are prepared to make significant commitments, subject to due diligence. I am
prepared to roll over into this transaction at least $1 billion of my own
equity -- and potentially all of my existing stake depending on the ultimate
terms of the agreements with the private equity firms regarding the new
ownership structure. Credit Suisse is also highly confident it can arrange the
necessary debt financing, and since August 6, a number of major banks have
contacted Credit Suisse to express their interest in participating in the debt
financing.
Market News and Data brought to you by Benzinga APIs© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Loading...
Posted In: NewsManagement
Benzinga simplifies the market for smarter investing
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
Join Now: Free!
Already a member?Sign in