If Christmas comes for Best Buy shareholders, it will probably come about two months late.
Investors certainly got a lump of coal yesterday as shares of the struggling electronics chain tumbled as much as 18 percent — their biggest one-day drop in two years — after the retailer said it has extended the deadline for a takeover bid from founder Richard Schulze to the end of February.
The news was a disappointment to investors, who just 24 hours earlier had bid up Best Buy shares nearly 16 percent after a newspaper based near the company’s Richfield, Minn., headquarters reported that Schulze was expected to make a buyout offer as soon as yesterday.
Best Buy’s stock yesterday dropped to as low as $11.60 before closing at $12.05, down 14.7 percent.
Prior to yesterday’s extension to February, Schulze had been given until Sunday to submit a bid.
Best Buy said yesterday the extension is in the best interests of shareholders and will give Schulze an opportunity to review the company’s holiday performance before making an offer.
In mid-September, the 71-year-old entrepreneur had made an initial offer of $24 to $26 a share for Best Buy, valuing the company at about $8.5 billion.
Best Buy’s recent results and holiday outlook, however, have disappointed investors, sending its shares tumbling 35 percent.
For the third quarter, Best Buy suffered a loss amid sagging sales and restructuring charges as its stores continued to get pummeled by rivals like Amazon and Walmart.
Accordingly, investors are currently expecting a significantly reduced offer from Schulze if he comes through.
This week, speculation had put an initial bid in the $17 to $18 range, valuing the company at around $6 billion.