The owner of prominent bookstore chains Waterstones and Barnes & Noble is reportedly gearing up for a potential stock market listing. Elliott Investment Management, the hedge fund behind these major retailers, has initiated discussions with potential advisers concerning an initial public offering (IPO), according to reports from the Financial Times.
The multibillion-pound investment group appears to favor a London listing over a New York one, a move that could offer a significant uplift to the UK stock market. Although preliminary conversations have begun, sources close to the situation indicate that no definitive decisions have been made, leaving the plans open to change. The company’s financial year concludes in April, suggesting that any IPO would occur no sooner than after the summer. Reports suggest Elliott might seek to appoint investment bankers early next year to aid in the process.
Barnes & Noble and Waterstones collectively stand as the leading booksellers in the United States and the United Kingdom, boasting over 600 locations in the US and more than 300 in the UK. Their success in the competitive retail landscape can largely be attributed to James Daunt, who serves as the chief executive of both chains. Daunt, also the founder of an independent book chain in the UK, has been at the helm of Waterstones since 2011. During his leadership, the company has successfully contested the dominance of online giants like Amazon and has expanded through acquisitions, including notable names such as Foyles, Hatchards, and Blackwells.
In a recent interview, Daunt suggested that an IPO in either London or New York seems inevitable, highlighting a typical trend for private owners aiming to offload interests in their businesses. He expressed a preference for an IPO as a better option compared to selling to another private equity firm.
Elliott Investment Management acquired Waterstones from Russian billionaire Alexander Mamut in 2018 for an undisclosed amount, and subsequently purchased Barnes & Noble in 2019 for $683 million (£510 million). Renowned for its assertive shareholder activism, Elliott has engaged with some of the world’s largest corporations and has a growing presence in the UK retail landscape, which includes a stake in the food chain Wasabi. Last year, the fund attempted to acquire the electronics retailer Currys, though that effort proved unsuccessful. Additionally, Elliott has applied pressure on BP’s board, leading to recent leadership changes.
An IPO would be a welcome addition to the UK stock market, which has faced challenges in attracting major new listings in recent years. The market has witnessed several firms moving to New York for their public offerings or choosing to revert to private ownership, making the potential for this listing a point of significant interest for investors and market analysts alike.
