In an effort to return Best Buy back to its previous status of being a private company, Best Buy founder Richard Schulze, who stepped down as company chairman two months ago, has submitted a proposal to purchase the retail leader. The proposal follows previous reports that Schulze was considering purchasing the company, which has been severely impacted by the growth of e-commerce.
According to a report by Jeffrey McCracken and Chris Burritt of Bloomberg, Schulze submitted his proposal and will offer stockholders between $24 to $26 for each share of Best Buy stock; this represents a significant premium for shares that closed at $17.64 on Friday. Since Schulze's proposal announcement, however, shares of the company have skyrocketed nearly 20 percent. Schulze currently already owns 20 percent of the company's stock.
Schulze's proposal letter also states that former CEO Brad Anderson and former President and COO Allen Lenzmeier could rejoin the company if the purchase is successful. In his letter, Schulze cited the company's poor performance and lack of leadership as his primary reason for wanting to purchase the company.
"I have been actively exploring all available options for my ownership stake," Schulze said in the letter. "That exploration has reinforced my belief that bold and extensive changes are needed for Best Buy to return to market leadership and has led me to the conclusion that the company’s best chance for renewed success will be to implement these changes under a different ownership structure."
The Best Buy founder has been attempting to purchase the company he founded for several weeks, although the Best Buy board asked him to postpone his efforts to allow the company to search for a new CEO to replace Brian Dunn, who resigned in April. An independent investigation found Dunn had an inappropriate relationship with an employee – something the investigation said Schulze was aware of at the time but failed to report.
Best Buy has been in financial turmoil recently; the company laid off 2,400 employees just last month and posted an annual loss last year for the first time in its history.