Best Buy: Turbulent times for electronics giant

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FILE - This Tuesday, Aug. 14, 2001 file photo shows Richard Schulze fo...

Richard Schulze

Best Buy signage Thursday, June 7, 2012, in Richfield, MN for an upcom...

Pedestrians walk past Best Buy, the No. 1 U.S. consumer electronics re...

  • Best Buy's top China executive resigns

    Article By: THOMAS LEE , Star Tribune Publish March 21, 2013 2:00 AM / Update March 21, 2013 6:19 AM

    A perceived lack of support and questions over the Five Star electronics chain’s future may have played roles in Nicolas Wang’s resignation.

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Richard Schulze

Richard Schulze

Best Buy signage Thursday, June 7, 2012, in Richfield, MN for an upcom...

Pacific Kitchen staff members Billy Woodson, left, and Hector Saenz High walked past high-end appliances on display at the Best Buy Pacific Kitchen display at the Richfield store last week. Best Buy’s appliance business has shown strong growth, one of the few product categories where sales have increased.

  • Best Buy counts on appliances for sales revival

    Article By: THOMAS LEE , Star Tribune Publish March 10, 2013 3:00 AM / Update March 9, 2013 4:05 PM

    When Best Buy Co. Inc. CEO Hubert Joly visited stores during his first week on the job in September, he quickly noticed something was amiss. Why, he asked, did some locations relegate some appliances to the back of the store when they should be more up front and center?

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Best Buy signage Thursday, June 7, 2012, in Richfield, MN for an upcom...

With the change, most corporate employees will work the traditional 40-hour week, though Best Buy managers still have discretion to accommodate some workers.

Richard Schulze

Richard Schulze

Best Buy’s better-than-expected fourth-quarter results came from stable sales of such bread-and-butter items as TVs, mobile phones and computers.

JIM GEHRZ • jgehrz@startribune.com The Best Buy store in Eden Prairie was busy over the noon hour on Tuesday. The 400 layoffs announced that day will not affect “Blue Shirts” who woprl in such store. the layoffs should affect store employees.

Richard Schulze

Best Buy signage Thursday, June 7, 2012, in Richfield, MN for an upcom...

  • Schafer: Schulze's main goals are already achieved

    Article By: LEE SCHAFER , Star Tribune Publish February 24, 2013 2:00 AM / Update February 23, 2013 4:42 PM

    All of the financial advisers, lawyers, bankers and investors assembled for Best Buy Co. Inc. founder Richard Schulze’s effort to take the company private could be putting in long hours this weekend to meet a Thursday deadline for a proposal.

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Best Buy

Richard Schulze

Best Buy CEO Hubert Joly

  • Schafer: Pitching in is the new rule at Best Buy

    Article By: LEE SCHAFER , Star Tribune Publish February 17, 2013 2:00 AM / Update February 16, 2013 3:20 PM

    It’s been all hands on deck at Best Buy Co., as about 600 district and territory managers and other staffers, with hundreds more from headquarters, jumped into stores for a 10-day push that closed the fiscal year that just ended.

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Amy Poehler was a good choice, but the Blue Shirt didn’t talk enough, said market researcher Leslie Zane.

This undated image provided by Best Buy, shows Amy Poehler on the set...

The Best Buy sign at its store in Richfield, down the street from the company's headquarters.

Best Buy CEO Hubert Joly,working the floor as a "blue shirt" at the St. Cloud store in September.

Mike Ersfeld, general manager of a Best Buy store in Eden Priaire

Mike Mikan

What was supposed to be an act of inspiration — a Super Bowl ad featuring pop music star Justin Bieber and rock veteran Ozzy Osbourne — turned into a vehicle of desperation for Best Buy.

Stephen Gillett

Richard Schulze

  • Best Buy offer deadline postponed

    Article By: THOMAS LEE , Star Tribune Publish December 15, 2012 2:00 AM / Update December 14, 2012 11:12 PM

    Delay a sign that company "is absolutely open to an offer." At the behest of the company, Best Buy and its founder agreed to extend the deadline for a buyout bid until February.

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FILE - This Tuesday, Aug. 14, 2001 file photo shows Richard Schulze fo...

Richard Schulze

Best Buy signage Thursday, June 7, 2012, in Richfield, MN for an upcom...

A Best Buy Microsoft Windows 8 consultant, David Smith, left, works wi...

  • A Best Buy boost falls flat

    Article By: THOMAS LEE , Star Tribune Publish December 4, 2012 2:00 AM / Update December 3, 2012 7:48 PM

    The electronics retailer had hoped the new Windows 8 operating system would bump up sales of PCs, notebooks and tablets.

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A chilled but excited Black Friday customer rushed into the Best Buy store in Eden Prairie as General Manager Mike Ersfeld greeted the midnight throng.

Shoppers head to and from the Best Buy in Richfield, MN, Thursday, Mar...

FILE - This Tuesday, Aug. 14, 2001 file photo shows Richard Schulze fo...

FILE- This Tuesday, Aug. 14, 2001, file photo, shows Richard Schulze f...

One World Trade Center, center right, towers above the lower Manhattan...

Hubert Joly

Sharon McCollam

  • New Best Buy CFO draws praise

    Article By: THOMAS LEE , Star Tribune Publish November 13, 2012 2:00 AM / Update November 12, 2012 9:42 PM

    Wall Street approves of Sharon McCollam, who hopes to apply her e-commerce savvy from Williams-Sonoma to the struggling retailer.

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  • Best Buy's slump might help Schulze

    Article By: THOMAS LEE , Star Tribune Publish November 7, 2012 2:00 AM / Update November 6, 2012 11:10 PM

    The stock's continued slide could allow the company's founder to offer to buy the company for considerably less money.

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Best Buy CEO Hubert Joly

Best Buy CEO Hubert Joly, on the job less than two months, will meet with New York analysts.

  • Best Buy stock hits a 10-year low

    Article By: THOMAS LEE , Star Tribune Publish October 27, 2012 2:00 AM / Update October 26, 2012 8:51 PM

    Experts say Best Buy's sliding finances and a looming buyout bid are forcing CEO Joly to rush out a turnaround strategy.

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Mike Vitelli

Richard Schulze

  • Schulze gets access to key execs

    Article By: THOMAS LEE , Star Tribune Publish October 10, 2012 2:00 AM / Update October 9, 2012 8:47 PM

    The Best Buy founder will use the discussions to help develop a business plan to show investors before he bids.

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Scott Durchslag said the consumer needs to see value beyond price.

FILE- This Tuesday, Aug. 14, 2001, file photo, shows Richard Schulze following a news conference in Vancouver.

Best Buy will grab plenty of iPhone 5 sales but can’t match the buzz at Apple’s stores

Best Buy hopes moving workers to the sales floor will help focus on selling customers more merchandise. Here, John Haupert helped Tanya Matheys purchase an iPad and iPod at a Best Buy in Eagan in 2010.

Best Buy has appointed a new CEO, Hubert Joly, to lead the beleaguered...

Hubert Joly

The former KMART store property in New Hope has been shuttered and pur...

Best Buy founder Richard Schulze

  • Best Buy clears way for Schulze offer

    Article By: THOMAS LEE , Star Tribune Publish August 28, 2012 2:00 AM / Update August 27, 2012 10:56 PM

    The company founder, who now will be able to see the firm's confidential information, can't pursue a deal until January if the board rejects his buyout offer.

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Hubert Joly

  • Can Hubert Joly save Best Buy?

    Article By: THOMAS LEE , Star Tribune Publish August 21, 2012 2:00 AM / Update August 20, 2012 10:35 PM

    If Richard Schulze retakes business, Hubert Joly could be out. In that atmosphere, he must craft a turnaround plan.

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Richard Schulze

Hubert Joly

Mike Mikan

Richard Schulze

Hubert Joly

Best Buy Founder Richard Schulz

Richard Schulze

Best Buy held its annual shareholders meeting at Best Buy corporate he...

  • Best Buy bid complicates CEO hunt

    Article By: THOMAS LEE , Star Tribune Publish August 8, 2012 2:00 AM / Update August 7, 2012 9:41 PM

    Richard Schulze's attempt to buy the firm, analysts say, means Best Buy may need to hire a more well-known name in retailing.

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  • Schulze's letter to Best Buy board

    Publish August 6, 2012 2:00 AM / Update August 6, 2012 8:27 AM

    August 6, 2012

    Board of Directors
    Best Buy Co., Inc.
    7601 Penn Avenue South
    Richfield, MN 55423

    Attention: Hatim Tyabji
    Chairman of the Board of Directors

    Dear Hatim:

    Since founding the Sound of Music in 1966 and opening the first Best Buy branded store in 1983, I have believed in Best Buy and its future. It goes without saying that I care deeply about the company’s customers, employees and shareholders – and I will always do so. As you know, since stepping down from the Board on June 7th, I have been actively exploring all available options for my ownership stake. 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.

    Over the last two months, I have done an extensive amount of work to develop a plan to address the company’s challenges, and I have had conversations with several premier private equity firms with deep experience in retail who are interested in a possible acquisition of Best Buy. In addition, I have had discussions with highly-regarded former Best Buy senior executives, including Brad Anderson and Allen Lenzmeier, who have expressed an interest in rejoining Best Buy in this context. As you are aware, Minnesota law requires that I receive permission from the Board of Directors before I reach any agreement with potential partners in this effort. While I have not yet reached any such agreements, I am confident, based on my discussions to date, that I could in short order if the Board allows me to do so.

    As you know, Hatim, I have made repeated requests to the Board for several weeks now to provide me with due diligence information and the consent to form a group required under Minnesota law. In your most recent communication to my advisors, you indicated that the Board would need an additional three weeks before it could consider my requests. I am submitting this letter in the hope that, with a concrete proposal in front of it, the Board will have a compelling basis on which to grant my requests and avoid further delay.

    Based on my analysis of publicly available information, and subject to due diligence, I would propose to acquire all of the common stock of Best Buy for a purchase price in the range of $24.00 to $26.00 per share in cash. This represents a very compelling opportunity for Best Buy shareholders, who would receive the certainty of an immediate all-cash premium of 36% to 47% for their shares based on the latest closing stock price of $17.64 on August 3, 2012.

    The transaction would be financed through a combination of investments from private equity firms, my equity investment of approximately $1 billion, and debt financing. Based on significant work done to date, Credit Suisse, who I have retained as my financial advisor, is highly confident that it can arrange the necessary debt financing.

    With the Board’s agreement that I may work together with potential private equity partners and former senior executives, and with timely access to relevant non-public company information, I am confident that the necessary due diligence could be completed expeditiously and a binding agreement to acquire Best Buy could be reached quickly. Of course, I am prepared to enter into a customary confidentiality agreement and begin work immediately.

    Hatim, I cannot emphasize strongly enough how much I believe in Best Buy and its future, and how much I would welcome the opportunity to do what is best for shareholders and Best Buy. I believe there is an urgent need for Best Buy to reinvigorate growth by reconnecting with today’s customers and building pathways to the next generation of consumers. I feel that the transaction I am proposing would be a “win-win”, as it would allow shareholders to receive compelling value for their shares, and it would allow Best Buy to take the actions that it needs to take outside of the public sphere. I believe that it is in our mutual interest to move as quickly and efficiently as possible and appreciate your prompt attention to this matter.

    Of course, neither Best Buy nor I shall be subject to any binding obligation with respect to any transaction unless and until a definitive agreement is executed and delivered.

    I look forward to your response at your earliest convenience.

    Sincerely,
    Richard Schulze

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Richard Schulze

Richard Schulze

Brad Anderson

Glen Stubbe/Star Tribune Friday, April 22, 2005 -- Maplewood, Minn...

Glen Stubbe/Star Tribune Friday, April 22, 2005 -- Maplewood, Minn...

The Geek Squad is at the center of Best Buy's new Connected Store concept at their flagship store in Richfield.

Richard Schulze

Best Buy founder Richard Schulze

Best Buy held its annual shareholders meeting at Best Buy corporate he...

  • Best Buy moves against Schulze

    Article By: THOMAS LEE , Star Tribune Publish June 23, 2012 2:00 AM / Update June 22, 2012 9:27 PM

    Retailer now says shareholders must own 25 percent of its stock to call a special meeting. Founder Richard Schulze has 21 percent.

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Best Buy

  • Best Buy short on specifics

    Article By: THOMAS LEE and WENDY LEE , Star Tribune staff writers Publish June 22, 2012 2:00 AM / Update June 21, 2012 9:41 PM

    Shareholders heard from interim CEO Mike Mikan. Later, directors changed the bylaws to make a private takeover tougher.

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Best Buy shops set to shut. A general view of Carphone Warehouse's Bes...

FILE- This Tuesday, Aug. 14, 2001, file photo, shows Richard Schulze f...

A Best Buy employee in Mountain View, Calif., looked over a cellphone contract.

An Aug. 14, 2001, file photo, of Richard Schulze.

  • A private Best Buy: It's a long shot

    Article By: THOMAS LEE , Star Tribune Publish June 9, 2012 2:00 AM / Update June 8, 2012 9:17 PM

    Despite the odds, analysts and investors say Richard Schulze could ultimately prevail -- if he's willing to give up some control.

    Full StoryFull story

Shoppers head to and from the Best Buy in Richfield, MN, Thursday, Mar...

Best Buy founder Richard Schulze

  • Best Buy founder exits -- for now

    Article By: THOMAS LEE , Star Tribune Publish June 8, 2012 2:00 AM / Update June 8, 2012 5:44 AM

    Richard Schulze is leaving the troubled retailer early but may be considering using his 20 percent stake to retake control.

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FILE - In this Sept 12, 2011 file photo, a Best Buy employee looks ove...

Brian Dunn, president and chief executive officer of Best Buy Co. Inc....

Roseville, Mn. Friday 11/26/10 Black Friday early shopping. These peo...

April 2000: Best Buy founder Richard Schulze

Richard Schulze

Richard Schulze

Hatim Tyabji

Best Buy CEO Brian Dunn thanked customers for coming to Best Buy and s...

April 2000: Best Buy founder Richard Schulze

Shoppers head to and from the Best Buy in Richfield, MN, Thursday, Mar...

  • Best Buy missing in cloud frenzy

    Article By: THOMAS LEE , Star Tribune Publish May 13, 2012 2:00 AM / Update May 12, 2012 2:46 PM

    Experts say cloud technology can help the Richfield-based company boost revenue as shoppers turn to mobile devices.

    Full StoryFull story

Brian Dunn, president and chief executive officer of Best Buy Co. Inc....

Barry Judge

Best Buy employees walk through the parking lot and to the Best Buy st...

Brian Dunn, president and chief executive officer of Best Buy Co. Inc....

In this photograph taken by AP Images for Best Buy, Brian Dunn, then Best Buy's CEO, greets Black Friday shoppers in Eden Prairie.

  • Best Buy opening up its CEO search

    Article By: THOMAS LEE , Star Tribune Publish April 21, 2012 2:00 AM / Update April 20, 2012 11:56 PM

    The Richfield-based retailer's new commitment to transparency will help it recruit a world-class leader, experts say.

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April 2000: Best Buy founder Richard Schulze

Brian Dunn

Brian Dunn

In this photograph taken by AP Images for Best Buy, Brian Dunn, Best B...

Brian Dunn

Best Buy headquarters in Richfield.

G. Mike Mikan, Best Buy interim CEO

Best Buy headquarters in Richfield.

Minneapolis,MN. Tuesday 6/25/2002 Best Buy Annual Meeting.L to R Bra...

New Best Buy CEO Brian Dunn answered media questions after th...

Brian Dunn

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