Barnes & Noble Plans to Buy Babbage’s

Barnes & Noble Inc. said it will buy Babbage’s Etc. for $189 million in a deal that would greatly expand the giant bookseller’s offerings of computer software and video games. Privately held Babbage’s is owned by Leonard Riggio, who is chairman and chief executive of New York-based Barnes & Noble. Barnes & Noble formed a special committee of independent directors to evaluate the feasibility and fairness of the deal, given Riggio’s connection to both companies. Babbage’s, based in Grapevine, Texas, operates 495 stores under the Babbage’s, Software Etc. and GameStop names. The purchase would give Barnes & Noble a piece of the video game and software business, which continues to grow rapidly. Barnes & Noble currently sells some software in its stores and online. A small selection of video games is available online but not at its stores. Barnes & Noble also would take on $26 million in Babbage’s debt. The purchase is subject to regulatory approval and is scheduled to close in 30 days. Barnes & Noble fell 13 cents to close at $26.50 on the New York Stock Exchange. The acquisition was announced after the markets closed.