Sandell Asset Management has offered a buyout proposal to Barnes & Noble (NYSE: BKS) in hopes to increase financing for the bid and take the company private. An increase in shares followed this announcement but the bookseller did not have plans to consider this deal with the investor. Barnes & Noble’s jump of 19% to $7.85 marks the biggest rise since May 2013, valuing the company at about $501 million.
The proposal claims to increase the bookseller’s value to about $750 million including debt while equity totaling to about $666 million at $9.17 a share. The investment group is looking to arrange $500 million to fund the deal and would allow certain holders to participate in the privatization that wouldn’t require changes to the company’s management or operations.
Despite this planned arrangement, Barnes and Noble has no intention of requiring Chairman Leonard Riggio to roll over his 18% stake in the company, which would add a debt financing of $500 million.
“The company does not take Sandell’s proposal as bona fide,” Barnes & Noble announced in a statement.