Report: Founder of Best Buy may give up on takeover bid
New York — Richard Schulze, founder of Best Buy Co., may abandon a buyout bid and instead line up investors to take a minority position in the electronics retailer, Reuters reported.
Schulze informed the Best Buy board in August that he was interested in partnering with private equity partners to buy the struggling consumer electronics company. But he has been unable to get enough support from banks to finance a deal that would allow him to take it private, the report said.
"We believe the equity raise required for this deal would be a major challenge for Mr. Schulze given the potential size of the deal and the structural challenges facing the company," RBC Capital Markets analyst Scot Ciccarelli said in the Reuters report. "With that in mind, it doesn’t come as a surprise to us that Mr. Schulze is considering alternatives to his original plan."
Whole Foods Q1 profit jumps 24%
Austin, Texas — Whole Foods Market Inc. reported that its first-quarter net income rose 24% to $146 million, exceeding expectations, on stronger revenue. But the grocer narrowed its revenue forecast and said its earnings growth may slow through the remainder of the year amid higher store-opening costs and plans to increase its selection of lower-priced products.
Total sales increased nearly 14% to $3.86 billion for the 16-week period that ended Jan. 20. Same-store sales were up 7.2% for the quarter.
Whole Foods opened 10 stores in the first quarter and has opened one store so far in the second quarter. It plans to open five additional stores in the current quarter.
The company said it recently signed 11 new leases averaging 38,800 sq. ft. in size. These stores are scheduled to open in fiscal year 2014 and beyond.
The retailer also closed on the purchase of six locations from Johnnie’s Foodmaster on Nov.30, which expands its presence in the Boston area. It is remodeling the stores and plans to reopen them under the Whole Foods Market banner in its 2013 fiscal year.
"We opened a record number of stores and delivered another quarter of strong sales and earnings growth," said Walter Robb, co-CEO of Whole Foods Market. "We are well-positioned to internally fund our expansion plans and have the pipeline and infrastructure in place for square footage growth to accelerate through 2014 and hopefully beyond."
Former Ulta CEO to head Michaels
IRVING, Texas — Michaels Stores has named Chuck Rubin CEO and a member of the board of directors. Rubin, currently the president and CEO of Ulta Beauty, will assume his new roles after a brief period of transition, at which time Michaels will discontinue the office of the CEO, established on an interim basis in May 2012. Charles Sonsteby, a member of the office of the CEO, will continue as the company’s chief administrative officer and CFO.
Rubin brings more than 30 years of retail industry experience, including serving as president, CEO and member of the board of directors for Ulta Beauty (ULTA), where since 2010, he successfully led his team in driving record revenue and earnings growth, as well as creating significant shareholder value for one of the largest beauty retailers in the United States.
"Michaels is an iconic brand and a category leader in the large and fragmented arts and crafts industry, with considerable potential moving forward," said Rubin. "With its diverse product offering of industry defining brands and unique customer engagement strategy, Michaels has built a loyal customer base. I am honored and excited by the opportunity and look forward to working with the Company’s talented management team and dedicated associates."
Rubin joined Ulta Beauty as COO in May 2010, assuming the position of president and CEO later that year as part of a planned CEO succession process. Prior to that he spent six years with Office Depot where he served as EVP and chief merchandise and marketing officer, rising to president North American Retail.