Barnes & Noble Inc. (BKS) and its Nook product became a lot more viable this morning, after Microsoft invested $300 MM into a subsidiary holding the Nook college books business.  The implied valuation of the entity is $2 billion.  I don’t think that the Nook would have lasted without a company with more clout and cash stepping in to assist in the endeavor.  It seems like a reasonable bet for Microsoft except I do think the implied valuation seems pricey.  I would prefer to see Microsoft buy RIMM which would boost earnings even if they offered a reasonable premium, and would certainly make the company a more viable competitor in the mobile phone market.  This is a huge win for Barnes & Noble as they retain 82% of the subsidiary and they have a partner in addition to John Malone ready to bring in additional cash.

http://www.bloomberg.com/news/2012-04-30/microsoft-to-invest-300-million-in-venture-with-barnes-noble.html

INVESTING IN THE FINANCIAL MARKETS INVOLVES RISKS. OPTIONS ARE NOT SUITABLE FOR ALL INVESTORS.