Elliott to buy Barnes & Noble; Daunt will run both chains

In a seismic shift for the book trade, Elliott Advisors (UK) Limited have entered into a definitive agreement to acquire Barnes & Noble in an all-cash transaction valued at approximately $683m (£537m), including the assumption of debt.

James Daunt, chief executive of Waterstones, will assume also the role of c.e.o. of Barnes & Noble following the completion of the transaction.  Elliott will own both Barnes & Noble and Waterstones, with each bookseller to operate independently.

Daunt said: “I look forward greatly to working with the booksellers at Barnes & Noble. Physical bookstores the world over face fearsome challenges from online and digital, a complex array of difficulties that for ease and some evident reason we lay at the door of Amazon. Our purpose is to create, by investment and old fashioned bookselling skill, bookshops good enough to be a pleasure in their own right and to have no equal as a place in which to choose a book. We counter thereby Amazon’s siren call and defend the continued existence of real bookshops. We do so now with all the more confidence for being able to draw on the unrivalled bookselling skills of these two great companies. I am grateful to Elliott for their commitment to support the continued transformation at Waterstones, and now also the same at Barnes & Noble. I thank Mr Riggio for his confidence and support.”

Barnes & Noble is the largest bookseller in the USA with 627 bookstores across all 50 states. It had sales of $3.662bn for the fiscal year 2018. Waterstones is the largest bookseller in the UK with 293 bookshops, including those in Ireland, The Netherlands and Belgium. It had sales of £402m in the 2018 financial year.

Daunt said he will be based both in New York and in London as he told The Bookseller he needs to get to know the US chain but does not expect to make major changes to the number of stores or run-down its e-book business the Nook.

Leonard Riggio, founder and chairman of Barnes & Noble, said he has "admired" Waterstones over the years and expressed confidence in Daunt. The deal marks the end of the once-dominant US book retailer as a publicly listed company. 

“We are pleased to have reached this agreement with Elliott, the owner of Waterstones, a bookseller I have admired over the years. In view of the success they have had in the bookselling marketplace, I believe they are uniquely suited to improve and grow our company for many years ahead,” said Riggio. “I am also confident that James Daunt has the leadership ability and experience necessary to lead this great organisation. I will do everything I can to help him make the transition smooth.” 

Paul Best, portfolio manager and head of European Private Equity at Elliott, added: “Our investment in Barnes & Noble, following our investment last year in Waterstones, demonstrates our conviction that readers continue to value the experience of a great bookstore.”

The confirmation comes hours after the Wall Street Journal reported on a potential deal amid speculation Daunt would run both chains.