Yucaipa Buys Barnes & Noble Shares

NEW YORK (Reuters) – Yucaipa Cos, a private equity firm controlled by billionaire Ron Burkle, said on Friday it had acquired an 8.3 percent stake in bookseller Barnes & Noble Inc (BKS.N), saying it believed the shares were undervalued.

The company’s shares rose 4 percent after-hours to $15.99, after the announcement.

Yucaipa funds said it had bought about 4.58 million shares since Nov. 24 for about $67.3 million, net of commissions, the company said in a filing with the U.S. Securities and Exchange Commission.

Yucaipa said it would hold the shares as an investment, but would “closely monitor the company’s performance and may modify their plans in the future.”

The company’s stock sank to nearly $12 after reporting a bigger-than-expected quarterly loss and cutting its full year forecast on Nov. 20.

Barnes & Noble follows its smaller rival, Borders Group Inc (BGP.N) in attracting investment. Borders’ largest shareholder is hedge fund Pershing Square Capital Management, led by William Ackman, and the company last year received $42.5 million in financing from the fund.

(Reporting by Michele Gershberg, additional reporting by Elinor Comlay; editing by Leslie Gevirtz and Andre Grenon)