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BARNES & NOBLE.COM TO ACQUIRE FATBRAIN.COM
NEW YORK, N.Y., SEPTEMBER 13, 2000 -- Barnes & Noble.com (Nasdaq: BNBN)
(www.bn.com) announced today that it will acquire Fatbrain.com, Inc. (Nasdaq:
FATB) (www.fatbrain.com), the third largest online bookseller specializing in
professional and technical titles for the corporate marketplace.
Under the terms of the deal, Barnes & Noble.com will acquire Fatbrain.com in a
merger, in exchange for $4.25 per share for all the outstanding shares of
Fatbrain.com. After the merger, Fatbrain.com will become a wholly owned
subsidiary of Barnes & Noble.com llc. The consideration is comprised of 75
percent stock in Barnes & Noble.com and 25 percent cash for each Fatbrain.com
share. The deal is valued at approximately $64 million. The transaction is
subject to regulatory and stockholder approvals, including Hart Scott Rodino
clearance.
Fatbrain.com's senior management, including its president and chief executive
officer, Dennis Capovilla, and executive vice president of Product Development,
Kim Orumchian, would continue in their current positions, and the company would
remain headquartered in Santa Clara, Calif.
Fatbrain.com's Web-based services reach more than 3.5 million employee desktops
at almost 350 Fortune 1000 companies worldwide. The company's Information
Exchange offering is a comprehensive Web-based method to catalogue, present and
distribute corporate materials, ranging from third-party published works such
as books and training materials to a company's own publishable content. There
are more than 500 individual Fatbrain.com co-branded online bookstores and
information resource centers, most of which are accessed via the sponsoring
organization's corporate intranet.
"We believe Fatbrain.com's business-to-business focus, combined with its
digital publishing and print-on-demand capabilities, complement Barnes &
Noble.com's consumer-based initiatives in these areas," said Steve Riggio, vice
chairman of Barnes & Noble.com. "We also believe that the companies have
complementary cultures that will foster our ability to build both the consumer
and business-to-business markets together. Most important, we are impressed
with the Fatbrain.com management team, whose talent and experience has
distinguished them as leaders in the corporate bookselling marketplace."
"We are extremely excited about our proposed merger with Barnes & Noble.com,"
said Mr. Capovilla of Fatbrain.com. "While the synergies derived from our book
businesses are an obvious fit and will naturally benefit from increased scale,
we believe the incremental resources provided by the Barnes & Noble.com backing
and brand will greatly enhance and accelerate the rollout of Information
Exchange to corporations seeking to streamline the management and distribution
of their publishable materials."
With the acquisition, Barnes & Noble.com would own approximately 50 percent of
MightyWords, formerly a subsidiary of Fatbrain.com and a leading provider of
digital content. In June Barnes & Noble.com invested approximately $20 million
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For a 30 percent equity stake in MightyWords. Fatbrain.com retained an equity
stake of approximately 23 percent in MightyWords.
BARNES & NOBLE.COM'S MANAGEMENT WILL HOST A CONFERENCE CALL FOR INVESTMENT
ANALYSTS AT 5:15 P.M. EST ON WEDNESDAY, SEPTEMBER 13, 2000. THIS CALL WILL BE
SIMULCAST ON THE WEB AT WWW.STREETFUSION.COM AND WILL BE ARCHIVED FOR 10 DAYS.
ABOUT FATBRAIN.COM
Fatbrain.com(TM) (Nasdaq: FATB) is the leader in managing, marketing and
distributing information for businesses. Today, the company's Web-based
services reach more than 2.5 million employee desktops at more than 350 of the
fortune 1000 corporations worldwide. Fatbrain.com's easy-to-use, comprehensive
solutions deliver valuable corporate information in print and/or digital form.
Last year, the company was named the second fastest-growing public company in
Silicon Valley. Visit Fatbrain.com at http://www.fatbrain.com.
###
Fatbrain.com(TM) is a trademark of Fatbrain.com, Inc. All company and product
names may be trademarks of the respective companies with which they are
associated.
ABOUT BARNES & NOBLE.COM
Barnes & Noble.com is the first online bookseller to offer a vast in-stock
inventory with an editorially rich bookselling environment. The company's
online catalogue includes more than three million titles, including virtually
every book in print as well as more than 12 million listings from its
nationwide network of out of print, rare and used book dealers. Its lightning
fast proprietary search engine enables customers to locate specific titles
quickly or to explore books on just about any imaginable topic. With more than
800,000 titles on its shelves it now offers the largest selection of in-stock
titles of any bookseller online. Encompassing over 30 miles of shelving, it is
the largest collection of books under one roof in the history of bookselling.
More than 50,000 book publishers, including thousands of small and independent
presses, university publishers and privately published books are represented.
Barnes & Noble.com brings the world's best-known bookselling name to the Web
with an editorially rich site that includes more than 500,000 synopses, book
reviews, customer reviews, table of contents, articles and interviews. It hosts
daily live author chats, bringing readers and writers together in lively
interactive discussions. Customers of Barnes & Noble stores can find a
nationwide store directory, complete with driving instructions and listings of
local events. Rated No. 1 by Forbes.com as the best bookselling site on the Web
two years running, the company strives to become the single best place to buy
books online.
Barnes & Noble.com's excellence in e-commerce extends to the music business,
where it was voted by Forbes.com as the No. 1 music site on the Web. Cited by
Forbes.com for being "best-of-class for anyone who wants to learn about the
music they're buying" it features a classical music superstore and is
distinguished by an emphasis on jazz, world music and Broadway show tunes. As
in its book site, Barnes & Noble.com's music site has extensive editorial
features from both in-house editors and licensed content.
Barnes & Noble.com is an industry leader in the burgeoning market for
electronic books. The site features more than 4,000 eBook titles that can be
viewed in a variety of formats. The company dramatically expanded its offering
of eBooks with the opening of its eBookstore in August 2000, featuring the new
Microsoft Reader platform, which will enable users to download eBooks to any
PC, laptop or Pocket PC and open the market for eBooks to more than 100 million
users. The company believes that in the not too distant future it will offer
digital versions of virtually every book in print.
In May 2000 Barnes & Noble.com pioneered Same-Day Delivery service to its
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Manhattan, New York customers. This rapid delivery service enables the huge
residential and working population of Manhattan to get delivery within hours of
virtually any book in print from today's bestsellers to the most hard-to-find
titles from small publishers. The service also includes delivery of more than
100,000 music CDs.
Barnes & Noble.com's e-commerce initiative extends to the B2B arena, where its
Business Solutions program provides Fortune 1000 companies with a turn-key
Intranet bookstore, enabling them to streamline and control their book
purchasing process. Barnes & Noble.com is also a leader in mobile commerce
through its Barnes & Noble On the Go wireless shopping. Customers can now shop
the company's Web site from portable devices such as PDAs and mobile phones,
giving them access to any book, anywhere, any time.
Barnes & Noble.com has made strategic investments in companies whose products
and services enable it to increase its offerings in information products and
services that are compatible with its core business. By doing so the company is
able to expand its scope by benefiting from the investments, marketing and
technology initiatives of industry leaders. To date, the company has invested
in enews.com, the Internet's No. 1 site for discount magazine subscriptions;
BuyEnlarge, which uses state-of-the-art technology to produce prints and
posters on demand, notHarvard.com, the pioneer in developing online branded
universities and the concept of eduCommerce, and MightyWords, a leading
provider of digital content.
SAFE HARBOR
This release may contain forward-looking statements regarding expectations of
the company. These statements are based on the beliefs of the management of the
company as well as assumptions made by and information currently available to
the management of the company. Such statements reflect the current views of the
company with respect to future events, the outcome of which is subject to
certain risks, including among others general economic and market conditions,
changes in product demand, the growth rate of internet usage and e-commerce,
possible disruptions in the company's computer or telephone systems, possible
increases in shipping rates or interruptions in shipping service, effects of
competition, the level and volatility of interest rates, changes in tax and
other governmental rules and regulations applicable to the company and other
factors, risks and uncertainties more specifically set forth in the company's
public filings with the Securities and Exchange Commission. The forward-looking
statements herein speak only as of the date of this release. The company
expressly disclaims any obligations or undertaking to release publicly any
updates or revisions to any forward-looking statement included in this release
to reflect any changes in the company's expectations or any changes in events,
conditions, or circumstances on which any such statement is based. Should one or
more of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual results of outcomes may vary materially from
those described herein.
Media Contact: Investor Relations contact
Greg Wood the blueshirt group for Fatbrain.com
A&R Partners Jennifer Jarman, Alex Wellins
650-762-2838 415-217-7722
[email protected] [email protected]
