Minneapolis — Dick Schulze has been unable to muster enough support from banks to finance a buyout of Best Buy, the Wall Street Journal reported.
Facing a Feb. 28 deadline to submit a formal acquisition proposal, the chain’s founder and former chairman may instead seek investors to take a minority stake in the business, unnamed sources told the newspaper.
The minority stake would likely be separate from his own 20 percent interest in the business, although talks with investors are preliminary and Schulze may pursue a different path, a source said.
Schulze, who resigned from Best Buy’s board last June for failing to report improprieties by former CEO Brian Dunn, announced his intention to acquire the company in August for approximately $8 billion, including $1 billion of his own equity.
Best Buy has since extended his deadline for submitting a buyout bid twice, as he worked to line up banks and equity investors, reunite his former management team, formulate a business plan, and await the retailer’s holiday sales results, according to various published reports.
Short of a third deadline extension, Schulze would have to wait another year before making another buyout offer under terms of an August due diligence agreement with the CE chain, should he miss the Feb. 28 cutoff.