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from Breakingviews:

Best Buy bid looks about as shaky as its target

By Robert Cyran
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.


The bid for Best Buy looks about as shaky as the target. Richard Schulze, the electronics chain’s founder, wants to take it private for up to $8.8 billion. His 20 percent stake adds credence to the offer, but financing and backers remain elusive. And given the laws where Best Buy is based, a takeover could be tough.

The immediate attractions of a leveraged buyout are apparent. Best Buy oozes cash. It should generate about $3 billion of EBITDA this year. Credit markets are easing, allowing borrowers to use less equity in deals. And Schulze, who was forced out as chairman in June, certainly would like to preserve his creation, where same-store sales have been falling at a 5 percent clip.

The cards are stacked against him, however. Best Buy, which hawks mobile phones and printers, has about $2 billion of debt outstanding. Even with all Schulze’s stock, fellow investors would need to put in at least $2 billion of additional equity. That might require a return to the “club deal,” where multiple firms work together. They have proved strenuous and unappealing, however. Moreover, there’s a lot of talk from Schulze and his bankers at Credit Suisse of private equity backers and arranging debt, but nothing firm yet.

from MediaFile:

Tech wrap: AT&T, Sprint admit using monitoring software

Phone makers RIM and Nokia denied installing on their mobile devices an app which can monitor what users are doing without their knowledge or consent while carriers AT&T and Sprint admitted to using it. The companies responded after a security researcher demonstrated in online videos how the "Carrier IQ" software worked on Google's Android operating system and said that phones running RIM's BlackBerry platform and Nokia's Symbian OS also had the software installed. AT&T and Sprint said they use "Carrier IQ" to monitor network quality.

Blackstone Group and Bain Capital are preparing a bid for all of Yahoo with Asian partners in a deal that could value the Internet company at about $25 billion, a source familiar with the matter said. The potential bid by the consortium, which would include China's Alibaba and Japan's Softbank, has not yet been finalized, the source and two other people familiar with the matter said. E-commerce giant Alibaba, whose primary interest is in buying back a 40 percent stake owned by Yahoo, is keeping its options open and said it has not decided whether to participate in a bid for all of Yahoo.

from MediaFile:

Tech wrap: Microsoft allowed looks at Yahoo’s books

Microsoft has signed a confidentiality agreement with Yahoo, allowing the software giant to take a closer look at Yahoo's business, according to a source familiar with the matter. Microsoft joins several private equity firms that are also poring over Yahoo's books and operations, as they explore various options for striking a deal with the struggling Internet company. Microsoft's signing of a nondisclosure agreement with Yahoo occurred "recently," according to the source.

Shares of Groupon fell for a third day , sinking below the company's initial public offering price of $20 less than three weeks after the daily deal company went public. Groupon raised more than $700 million in an IPO in early November, making it the biggest IPO by a U.S. Internet company since Google raised $1.7 billion in 2004. Analysts have cited concerns about increased competition, a greater availability of the company's stock for short-selling, and a sharp reversal of market sentiment that is taking down more speculative companies. Groupon shares ended the day down 15.5 percent at $16.96.

from MediaFile:

Call of Duty: Modern Warfare 3 hits stores tonight

[youtube]http://www.youtube.com/watch?v=mcalNiyxDJw&feature=youtu.be[/youtube]

One of the biggest video game launches ever is going down tonight at stores all over the U.S.  "Modern Warfare 3", the eighth game in the "Call of Duty" series is going on sale at midnight While the usual suspects like GameStop and Best Buy will be open late to accommodate the crowds, Wal-Mart is going all out by hosting tournaments centered around the game at more than 2,700 stores starting at 8 p.m..

To give you some idea of how big the market for this game is, last year it took a little over two months for "Call of Duty: Black Ops"  to generate $1 billion in global sales.

from MediaFile:

Tech wrap: Facebook cashes in on ads

Facebook's first-half revenue roughly doubled to $1.6 billion, underscoring the world's largest social network's appeal to advertisers, a source with knowledge of its financials told Reuters. Net income in the first half of 2011 came to almost $500 million, said the source, who wished to remain anonymous because privately-held Facebook does not disclose its results. Facebook's stronger results come as investors have pushed its valuation to roughly $80 billion in private markets, with many industry observers expecting the world's No. 1 Internet social network to go public in 2012.

Yahoo Chairman Roy Bostock fired CEO Carol Bartz over the phone on Tuesday, ending a tumultuous tenure marked by stagnation and a rift with Chinese partner Alibaba. CFO Tim Morse will step in as interim CEO, and the company will search for a permanent leader to spearhead a battle in online advertising and content with rivals Google and Facebook. Some analysts said Bartz's departure signaled the company had run out of options after failing to dominate the advertising and content markets and handing over its search operations to Microsoft.

from MediaFile:

Super Bowl Monday: The view from armchair copywriters

Ahhh, Super Bowl Monday. The hangovers. The salsa stains on the sofa. The dreams of winning your office betting pool crushed. And the ad reviews. Yes, today is the day when everyone -- many with little or no connection to advertising, football or tastemaking -- puts out a list of the top Super Bowl commercials. Some are better than others. USA Today's Super Bowl Ad Meter is probably the best known (and this morning had Bud Light's Dog Sitter ad ranked tops). But two others that are very good gauges of the winners/losers of the Ad Bowl are TiVo and the Kellogg Super Bowl Advertising Review.

They take very different approaches to rankings.  TiVo ranks the most engaging moments "using aggregated, anonymous, second-by-second audience measurement data" while Kellogg goes with the panel approach that asks viewers to grade ads based on "Attention, Distinction, Positioning, Linkage, Amplification and Net equity."

from Breakingviews:

Is Wal-Mart pulling a Circuit City on Best Buy?

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Is Wal-Mart pulling a Circuit City on Best Buy? Two years ago, the mega-retailer's electronics push helped send Circuit City into bankruptcy and eventual liquidation. Best Buy thrived for a time on its rival's misfortunes. But its own falling same-store sales suggest it may be the next weak link in the retail food chain.

from Shop Talk:

Check Out Line: Can new systems get Best Buy back on its game?

Check out the impending barrage of new video games. E3/

It is all about motion sensors and 3D as Nintendo, Microsoft and  Sony introduce new systems and devices to get more people  gaming.

Microsoft has a full-body motion-sensing system called Kinect. Nintendo has a new DS handheld device that can play games and show movies in 3D. Sony has the "Move," which uses a wand like the Wii to simulate motion in games.

from Shop Talk:

Check Out Line: Duke wins, but there’s another bracket to fill

duke1Check out a different kind of tournament bracket still underway.

The Duke Blue Devils may have won yet another college basketball title Monday night, but consumers can still make their "Sweet 16" picks in Consumerist.com's annual "Worst Company in America"  tournament, which runs through April 26.

In its fifth year, the website, owned by Consumers Union, the publisher of Consumer Reports, lets consumers vote for their least favorite companies in matchups much like the NCAA tournament. Starting with 32 "teams," the tournament pairs companies in votes in which the "winner" (think about it, in a worst company vote you want to lose) advances to face the next competitor.

from Shop Talk:

Check Out Line: Best Buy, Apple to sell iPads on Saturday

bestbuyCheck out how the long wait for the iPad is nearing its end.

Best Buy and Apple's own stores will begin selling the much-hyped iPad tablet computer on Saturday morning.

Apple said on Monday that versions of the device with Wi-Fi wireless Internet capabilities will be available in all 221 U.S. Apple retail stores and most Best Buy stores, for prices ranging from $499 to $699. Models using 3G wireless systems will hit stores in late April.

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