The bookstore chain Barnes & Noble Inc. managed to reach an agreement sell colour tablets made by Samsung, co-branded with the chains Nook label. The companies made a joint statement about the deal, which is an open challenge to Amazon.com Inc. and Apple Inc.
According to yesterdays statement, the new devices will combine the Nook software and the hardware of Galaxy Tab 4. The result it expected to be full-service tablets providing the customers with access to the 3-million book, magazine and newspaper collection of Barnes & Noble Inc. The 7-inch devices are said to be launched in the beginning of August and will be followed by a release of 10-inch Galaxy Tab 4 devices after a period of two months.
One of the analysts, who work for Janney Montgomery Scott LLC – Mr. David Strasser commented the expected results of the partnership between the two companies in a note to customers, which was cited by Bloomberg: “This will drive cutting-edge designs as well as dramatically cut losses.” Mr. Strasser also added that the deal with Samsung is “as good as it gets for Barnes & Noble”.
The news of the collaboration between the two companies follows the previously announced plan of Barnes & Noble to narrow down its large investments in the Nook unit, which proved out to be a financial drain over the last few years. The current strategy of Barnes & Noble Inc. is to concentrate mainly on its stores and college business.
According to the terms of the deal, one million co-branded colour tablets manufactured by Samsung Electronics are to be bought by Barnes & Noble over the next 15 months. The devices will be offered in the stores of the retailer, as well as on its website in early August this year.
Mr. Michael Huseby, who is the Chief Executive Officer of Barnes & Noble commented the future partnership in an interview, which was cited by the Wall Street Journal: The deal is “consistent with our objective of rationalizing the business by decreasing our internal cost structure. Well have exposure to the inventory, but its very manageable given the demand we forecast.”
Barnes & Noble Inc. was 3.54% up to close at 19.57 dollars per share yesterday, marking a one-year change of -8.08%. According to the information published on CNN Money, the 4 analysts offering 12-month price forecasts for Barnes & Noble Inc. have a median target of 16.00, with a high estimate of 32.00 and a low estimate of 12.00. The median estimate represents a -18.24% decrease from the last price of 19.57.
Samsung Electronics Co. Ltd was 0.88% down to close at 1,457,000 Korean won per share yesterday, marking a one-year change of -4.21%. According to information published on the Financial Times, the 42 analysts offering 12-month price targets for Samsung Electronics Co. Ltd have a median target of 1,750,000, with a high estimate of 2,200,000 and a low estimate of 1,150,000. The median estimate represents a 20.11% increase from the last price of 1,457,000.
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