High-profile hedge fund manager dumps Best Buy - Bring Me The News

High-profile hedge fund manager dumps Best Buy

David Einhorn, who leads New York-based Greenlight Capital Inc., has sold off his firm's 7.7 million shares, or 2.27 percent stake, in the Richfield-based electronics retailer. The Star Tribune reports Greenlight's losses could approach $100 million. Analysts tell the newspaper Einhorn's decision to exit could help former Best Buy chairman and founder Richard Schulze, who is exploring options for his 20 percent stake in the company, including an effort to take the company private.
Author:
Publish date:

David Einhorn, who leads New York-based Greenlight Capital Inc., has sold off his firm's 7.7 million shares, or 2.27 percent stake, in the Richfield-based electronics retailer. The Star Tribune reports Greenlight's losses could approach $100 million.

Analysts tell the newspaper Einhorn's decision could help former Best Buy chairman and founder Richard Schulze, who is exploring options for his 20 percent stake in the company, including an effort to take the company private.

Best Buy is still recovering from months of internal distractions, including the abrupt resignation of Schulze and former CEO Brian Dunn, while trying to come up with a profitable business strategy.

Former Fridley-based Medtronic CEO Bill George spoke with KSTP about the struggles at Best Buy and Supervalu.

Watch the interview below:

Next Up

Related

Best Buy chairman resigns early, may sell stake

Founder Richard Schulze is stepping down from the board of directors sooner than planned in order to explore options for his 20.1 percent ownership stake. Last month, Schulze announced he would resign on June 21 at the company's annual meeting. An investigation found he knew that former CEO Brian Dunn was having an inappropriate relationship with a female employee. Schulze, the founder and outgoing chairman, has been with the Richfield-based electronics giant since its debut in 1966 and is the company's largest shareholder.

Best Buy founder likely to wield significant influence

Even though Richard Schulze is stepping down, he remains the retail giant's dominant shareholder controlling more than 20 percent of Best Buy stock, according to the Star Tribune. Schulze announced he's resigning as chairman and board director from the Minnesota-based company after an internal investigation found he didn't disclose former CEO Brian Dunn's inappropriate relationship with an employee.

Best Buy CEO: 'Showrooming is one of the greatest falsehoods'

Best Buy's new top executive, Hubert Joly, tells the Star Tribune that he's "not a big fan of shrinking the company." He wants the Richfield-based electronics giant to maximize sales with its existing stores. One analyst was also a bit puzzled by Joly's comments about "showrooming." "I don't think he's right. I think there's plenty of evidence of people doing that," said Laura Kennedy.

Uncertain future for Best Buy's shaken shareholders

Best Buy is holding its annual shareholders meeting Thursday. The beleaguered Richfield-based electronics giant has had plenty of boardroom drama over the past three months, including the abrupt departure of company founder and largest shareholder Richard Schulze. After months of uncertainty, investors are eager to learn what's next for the world's largest consumer electronics retailer.

Schulze rejects condition of due diligence deal

Best Buy and its founder Richard Schulze continue to spar over Schulze's attempt to take the struggling Richfield-based electronics retailer private. The Star Tribune reports Schulze, Best Buy's largest shareholder with a 20% stake, rejected a proposal from the company's board of directors over the weekend. Best Buy says it offered to show Schulze the company's financial data in exchange for delaying any takeover attempt until 2013, should the board reject his bid.

Best Buy founder explores potential buyout options

Richard Schulze is reportedly talking with banks and looking for potential buyout partners as he considers taking the beleaguered Richfield-based electronics retailer private, Bloomberg reports. Schuzle is Best Buy's largest shareholder -- controlling 20.1 percent of the company's stock. The 71-year-old abruptly step down as chairman of the board earlier this month to explore his options.

Best Buy compensation consultant resigns, opposed retention bonuses

Longtime independent compensation expert, Don Delves, is no longer working with Best Buy's compensation committee. Bloomberg reports Delves quit after the Richfield electronics giant awarded more than 100 managers extra pay without linking it to performance -- a decision he opposed. According to an email statement, Best Buy said the incentive pay is "intended to ensure leadership continuity."

Best Buy gives Schulze green light to pursue buyout

Richfield-based Best Buy Co. Inc. and its founder Richard Schulze have reached an agreement that gives Schulze permission to review the company's financials and form an investment group to finalize an official takeover bid, Forbes reports. If the initial proposal is rejected, Schulze has agreed to wait until January 2013 to pursue his plan to buy the struggling electronics giant. Schulze has 60 days to present a fully financed definitive proposal to Best Buy's Board of Directors.