Who’ll Bid for Best Buy?

Best Buy’s banished boss Richard Schulze, who resigned earlier this year, is back to bid and he’s brought some LBO buddies along for the ride.

Or so he says.

It isn’t clear whether Best Buy will see a competing bidder emerge—which could truly be a shame for shareholders—but right now, there are so few LBO shops out there that can bid in a $9 billion deal that will require at the very least $1 billion in equity up front (never mind what might need to be re-invested).

The usual suspects? Well, some of them just popped up for the Knight Capital Group deal. TPG Capital is one likely bidder that has been seen all over not just retail auctions, but on the fundraising trail as well (they’ve been reported to be seeking a major managed account partner, not unlike KKR and Bain Capital, also potential boldface name bidders for Best Buy). Already across the globe in pursuit of Aussie swimwear maker Billabong, it remains to be seen how much TPG can put in play all at once.

Leonard Green Partners is another likely suspect to emerge in the bidding. The private equity firm’s ability to stick to its knitting through the recession, with deals like Whole Foods, earned it big returns and LPs recently re-upped for a 2012 fund for more than $6 billion. With a war chest like that, it isn’t even clear that the PE firm would need another partner.

Who else is looking to deploy cash? We’ve speculated repeatedly that the increasingly-active Goldman Sachs Capital Partners is doing all it can to generate revenue for the banking side of Goldman’s business (which, naturally, often advises the LBO shop and its $20 billion ’07 vintage fund)—making investments and charting exits through the back half of 2012. However, with little retail under GS Capital Partners’ belt, this PE bidder is a long shot for a Best Buy play.

There are smaller fish in this game as well—check out the one-day pop enjoyed by smaller electronics retailers Radio Shack and hhgregg Monday morning—each are older players in the retail game and their shareholders might be eager to hear from an LBO shop.

At their size—each with market capitalizations south of $300 million—they could wind up subject to auctions if bidders including Golden Gate Capital or Sycamore Partners look to mimic bigger bidders’ moves.

Image Credit: Best Buy