Barnes & Noble defends its moves

In a letter to shareholders, Barnes & Noble defended its 2009 $514 million purchase of a college bookstore business owned by founder Leonard Riggio and his wife,

the

Financial Times

reported.

According to the

FT

report, the bookseller, which has an annual meeting scheduled for September 28, said that

the business “was delivering compelling shareholder value” and offered long-term strategic benefits. It also argued that Barnes & noble’s 1999 purchase for $209 million of a video game retailer owned by Mr. Riggio eventually led to the successful spin-off of the GameStop business, delivering several billion dollars in shareholder value.

Billionaire investor Ron Burkle is seeking three seats on the Barnes & Noble board and has argued that the board “has been a rubber stamp for transactions benefiting the Riggio family,” the

FT

article said.

Burkle’s Yucaipa investment group holds nearly 20% of the company’s shares and seeks to overturn a poison pill provision that prevents it from acquiring more. Leonard Riggio and his brother Stephen hold more than a third of the shares, the report noted. Barnes & Noble says Burkle lacks a strategic plan for the company, the

FT

reported. (Source:

Financial Times,

Sept. 10, 2010.)