Barnes & Noble has teamed up with Microsoft to create a powerful competitor to the Amazon Kindle -- setting up a mano a mano battle for dominance of the e-reader market. The deal is built around the Barnes & Noble Nook and related digital business.
Microsoft annonced a $300 million investment in a new Barnes & Noble subsidiary, which could be spun off as a separate public company. Microsoft will hold a 17.6% equity stake in the subsidiary, giving it a valuation of $1.7 billion.
William Lynch, CEO of Barnes & Noble, said in a statement, “Microsoft’s investment in [the subsidary], and our exciting collaboration to bring world-class digital reading technologies and content to the Windows platform and its hundreds of millions of users, will allow us to significantly expand the business.”