Barnes & Noble.com: On Its Own

By Frank Pellegrini Thursday, Aug. 20, 1998
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NEW YORK: Sick of absorbing the consistent losses of its online division, Barnes & Noble.com, Barnes & Noble is spinning it off to a place where profits don't matter: the world of the Internet-stock IPO. As part of the whole, Barnes&Noble.com was dragging its parent into the red, losing $23 million in the recent second quarter. As a separate entity, though, the division can instantly join the club of Wall Street darlings -- Yahoo, Lycos, GeoCities and B&N archrival Amazon.com -- who rarely make any money but attract it in droves.

When it does go public, the new entity will offer 20 percent of itself, a slice plenty small enough to keep investors rabid and demand high. No word yet on the price. For the parent Barnes & Noble, though, the jettison is already paying off. Upon hearing the announcement, investors promptly bid the company's stock up $4 to $41.25 in morning trading.