The retailer’s founder is still contemplating how – or whether – to fill the two seats he gets on the board.
Best Buy Co. Inc. founder Richard Schulze’s bid to purchase the company may have ended in disappointment, but that doesn’t mean he plans to go into exile anytime soon.
Last Friday, Schulze visited the retailer’s headquarters in Richfield and spoke at length with CEO Hubert Joly, according to a source close to Schulze.
The company declined to comment.
Perhaps Schulze gave Joly some clue about whether he will rejoin the board of directors. Schulze has until this Friday to nominate candidates to fill the two board seats the company granted him because of his 20 percent stake.
After abandoning an outright buyout bid last month, Schulze and his private equity partners went to Plan B: Texas Pacific Capital, Cerberus Capital Management and Leonard Green would purchase minority stakes in Best Buy, entitling them each to one board seat. Combined with Schulze’s two seats, the allies would essentially control more than half of Best Buy’s 11-member board and perhaps restore Schulze to chairman. But the board resisted Schulze’s campaign for chairman and ultimately rejected bids by the private equity firms to pay between $400 million and $700 million for minority stakes in the company.
In a regulatory filing late last month, Schulze said he had not yet decided to fill his board seats. If he doesn’t nominate anyone, the company will nominate its own candidates.
As a director, Schulze would need to demonstrate a certain degree of obedience to Best Buy’s leadership. But as an outsider, Schulze could make yet another attempt at a later time to remake the board to his liking and reclaim his position as chairman, experts say.
Nevertheless, Schulze has appeared to cultivate a cordial relationship with Joly. He even played a key role in the selection of top executives in recent months. But after the shake-up at Best Buy last year that ultimately forced him to resign as chairman, Schulze may not accept a lesser role as a director.
“He’s preserving his options,” said Hillary Sale, a professor of law who specializes in corporate governance issues at Washington University in St. Louis. “He can leverage things better on the outside than on the inside with only two board seats.”
Thomas Lee • 612-673-4113