Best Buy Names New CEO as Founder Attempts to Purchase Retailer
Best Buy named a new CEO and sparred with founder Richard Schulze, who is trying to acquire the electronics retailer.
Hubert Joly, CEO of hotel operator Carlson Cos., will take over in September, replacing interim CEO Mike Mikan, Best Buy said today in a statement. Mr. Schulze, who had been chairman, left Best Buy in June and is trying to purchase the electronics retailer for as much as $9.5 billion with the help of private-equity partners. He's recruiting executives including former CEO Brad Anderson to revive sales as Amazon.com, Walmart Stores and other rivals have lured customers.
The appointment of Mr. Joly signals Best Buy plans to keep operating as a public company. Best Buy in April disclosed the departure of CEO Brian Dunn amid a board investigation into his "personal conduct."
Mr. Joly said Best Buy's more than 1,000 U.S. consumer-electronics stores and increasing online sales are "enormous assets" that will help rekindle growth. "This company is a great American icon," he said today in an interview. "It is a $50 billion company with enormous assets and a great brand name that can innovate and grow in this market."
Since 2008, Mr. Joly has been CEO of closely held Carlson, a Minneapolis-based operator of hotels including Radisson and Country Inns & Suites. Previously, he held various roles at Vivendi SA and McKinsey & Co.
Separately, Mr. Schulze declined an offer from the board to access confidential financial information, which would have required him to wait until January to take his bid directly to shareholders, Best Buy said yesterday. Mr. Schulze said he was still working on an acceptable agreement with Best Buy and was "shocked" by the company's statement.
"We were in the process of negotiating an acceptable standstill period when, without notice to me or to any of my advisors, the board issued its announcement," Mr. Schulze said.
In the midst of all this upheaval, Best Buy's marketers have been working to reframe the retailer's brand proposition. The electronics giant rolled out a new tagline this summer -- "Making technology work for you" -- and has been aggressive in its media buys for the crucial back-to-school and holiday seasons.
Best Buy also began rolling out its first "connected stores" this summer. The remodeled stores feature a "central knowledge desk" that offers services, support, training and classes and an expanded Geek Squad presence will be located at the front of the store. The stores focus on selling mobile phones, tablets and e-readers as well as their accompanying service plans.
~~~ Bloomberg News with contributions from Natalie Zmuda ~~~