What’s up with EONLINE?
EONline, the maker of e-books, has announced a plan to buy the parent company of rival Nook, in a deal valued at more than $700 million.
The transaction, announced Wednesday, would create a new, more profitable company, which would focus on e-readers.
It would also allow EON to continue to grow its e-book business, the company said.
It will pay a cash payment and expects to make the deal in the first quarter of 2021.
“This is a strategic and significant transaction for EON, and we look forward to its benefits for both companies,” said Chris Niles, chairman and CEO of EON.
“This is not just about making EON more popular; it’s about our company being more innovative, more valuable and more relevant to the 21st century.”
Nook, based in San Francisco, had been struggling in recent years with the growth of ebooks, which it now sells for around $4.99 to $5.99 per ebook.
Nook said it has grown its ebooks market share in the last few years from 0.5% in the fourth quarter of 2011 to nearly 3% now.
Nook’s books have become increasingly popular as e-reader adoption has accelerated in the past year, and in the U.S., as well.
Nooks books have been a major factor in the rise of ebook purchases on Amazon and other online retailers.
Nooks books, though, have not attracted the same levels of readership as ebooks from Nook.NOOK shares plunged more than 5% in after-hours trading after the news was announced.
Nooners stock dropped more than 3% as investors sought answers about the deal.
EON declined to comment.EON said in a statement that it has a strong track record of growing its ereaders business and is committed to continuing to invest in the business.
Eon also announced a strategic investment in the future of its ereader business, with a plan for EOS to develop new ereader products.EOS, a $25 billion e-reading business, has had success in the e-paper market with the launch of Kindle Paperwhite, a tablet-sized ereader that has been the best-selling e-device for the past several years.
But the ereader market is also growing.NONO said it will be taking a “comprehensive review” of the terms of the deal, including details about any potential synergies between the companies.
Noon, which will also continue to produce Nook books, said it was confident that the deal would not affect its ability to continue growing its business.NOOVE, founded in 2008, is the parent of Nook and its Kindle, Nook Mobile, NOOK Reader, NOOVE Desktop, Nooks Kindle, and NOOKE Apps.
Nornove is the third-largest ebook publisher in the world, according to a 2016 report from NPD Group.
The company has been focused on making its books available on Apple and Amazon, but has also begun selling e-ink devices from other vendors.
Nunn’s announcement comes as the industry is battling to find a replacement for the smartphone.
Amazon has announced plans to buy e-store e-commerce platform Shopify and a number of other firms are also interested in the company.
The sale of NOOK could be a game changer for e-publishing as it would create an independent e-printing platform.
The deal will give NOOK an exclusive deal to sell NOOK e-Books and NOOK books on its Nook store, which NOOO already has.