The battle of letters and press releases between Barnes & Noble and Ron Burkle shows no signs of abating. Within hours following a B&N letter to shareholders yesterday that reiterated the retailer’s belief that Burkle is planning to team with Aletheia Research & Management to take control of the company without paying a premium price, Burkle issued a statement calling the letter “ironic and hypocritical.”
“While the Board tries to frighten stockholders with the prospect of Mr. Burkle acquiring more than 20% of the Company – a scare tactic that is ridiculous given the facts – the truth is Leonard Riggio is the only stockholder with control, as evidenced by the compliance of his Board and his efforts to tighten that control through his recent exercise of out-of-the-money options on nearly one million shares,” the statement continued.
Burkle refuted B&N’s contention that approval of Yucaipa’s amendment to change B&N’s poison pill and the election of three Yucaipa board members would give Burkle control of the company. “It is simple math: Yucaipa’s three independent director nominees on a nine-member board cannot constitute a majority. Yucaipa’s campaign is not about taking control of Barnes & Noble on the cheap; it’s about returning a modicum of control back to stockholders who for too long have been short-changed. It is about giving stockholders a voice,” the statement read. Burkle added that B&N’s argument that he is in “cahoots” with Aletheia “is absurd.”
In addition to again stressing that Burkle’s proxy fight is a bid for control of B&N, the September 1 letter noted that neither Burkle nor its fellow nominees have experience running a bookstore chain. “Burkle has provided no strategic vision and offered no plan for the Company’s future,” the letter asserted, charging that “Burkle is persisting with his self-serving agenda that we believe is part of an effort to take control of the Company without paying shareholders a control premium.”