Barnes & Noble Education, Inc. (NYSE:BNED) (“the Company” or “BNED”), one of America’s largest contract operators of bookstores on college and university campuses and a leading provider of digital education services, today announced that it has acquired MBS Textbook Exchange, LLC (“MBS”) for $174.2 million in cash. Together, MBS and BNED will operate over 1,490 physical and virtual bookstores and serve more than 6 million students enrolled in higher education institutions.
MBS is the largest contract operator of virtual bookstores for the institutional client market and one of the largest used textbook wholesalers in the U.S. Through its MBS Direct business, MBS services more than 700 virtual bookstores with a comprehensive e-commerce experience and a broad suite of affordable new, used and digital course materials. MBS sources and sells new and used textbooks to over 3,700 physical college bookstores, including BNED’s 770 campus bookstores, and provides inventory management, hardware and point-of-sale software to approximately 485 college bookstores. It also operates textbooks.com℠, an e-commerce site for new and used textbooks.
Max J. Roberts, Chief Executive Officer, Barnes & Noble Education, Inc., said: “We have worked closely with MBS for over 30 years, and we are thrilled to bring our two complementary companies together. This combination will allow us to generate more value from the textbook marketplace through expected inventory and procurement synergies, which will enhance our ability to drive successful student outcomes by providing complete, affordable solutions that empower students and faculty. In addition, we will increase our addressable market to include the growing virtual bookstore market, and will now be able to offer our campus partners physical, virtual and hybrid bookstore models. Our ability to leverage our expanded customer reach and distribution channels gives us the opportunity to immediately accelerate our strategy and provide scale benefits, an enhanced competitive advantage in the rapidly changing higher education industry.”
For the MBS fiscal year ended August 31, 2016, MBS generated revenue of approximately $499.8 million and Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”) of approximately $54.7 million, with capital expenditures of approximately $1.8 million.1
Management believes the transaction will enhance BNED’s competitive positioning in the dynamic higher education industry as follows:
“We are excited to join a company that shares our commitment to serving the education marketplace and driving student success,” said Bob Pugh, Chief Executive Officer, MBS. “We are confident that joining forces with Barnes & Noble Education will enable us to serve the needs of our customers and partners even more effectively and better meet the demands of the changing education landscape. We look forward to being a member of the Barnes & Noble Education family.”
To read the press release in its entirety, visit www.bned.com.