Quote:
Originally Posted by Fbone
They ran out of airports and so can not expand in the US. And they know how to operate bookstores in smaller spaces. Plus, they can buy B&N with cash just from 2017 profits. They do have $4 billion in debt from acquisitions, though.
Indigo while it doesn't have long term debt doesn't have the cash. It would probably have to issue stock which may not go over well with B&N and Indigo shareholders. And B&N is four times larger (in sales) than Indigo and would be a heavy burden.
Either way B&N would get stripped down considerably.
It's a fun mental exercise.
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Sorry.
When I said airport layouts, I meant reuse their existing store layouts. In non-airport settings. Like malls or downtowns. The reason they're profitable is precisely because of those smaller layouts so the bigger storefronts won't suit them. Indigo, on the other hand, wants to sell more than books. They might have some use for the excess space.
And that debt is why buying the terminal patient isn't a great idea for Hudson. Better to roll their own, like Amazon, or play vulture.
B&N is going to get stripped down massively anyway but it makes more sense to wait for the liquidation sale and only pay for the parts they want. If nothing else, picking up the storefronts they prefer will be cheaper. They might even cut a deal with Indigo so each one gets the sites they prefer.
For all we know, that is why the deal fell through: the buyer crunched the numbers and saw their days are numbered and its too late for a change in management to save them.