Barnes & Noble and Microsoft Complete Strategic Partnership in New Subsidiary: NOOK MEDIA LLC

Barnes & Noble and Microsoft Complete Strategic Partnership in New Subsidiary: NOOK MEDIA LLC

Includes Barnes & Noble’s NOOK® Digital and College Businesses as well as Microsoft Investment to Advance Digital Reading Experience

NEW YORK & REDMOND, Wash.–(BUSINESS WIRE)– Barnes & Noble, Inc. (NYSE: BKS ) and Microsoft (Nasdaq: MSFT ) today announced the completion of their previously announced strategic partnership in NOOK Media LLC, a recently formed Barnes & Noble subsidiary and a leader in the emerging digital reading and digital education markets. Microsoft and Barnes & Noble’s strategic partnership in NOOK Media LLC will enable the companies to advance world-class digital reading experiences to the hundreds of millions of customers they jointly serve.

NOOK Media LLC comprises the digital and College businesses of Barnes & Noble and will continue to have a very close and mutually beneficial relationship with Barnes & Noble’s retail stores. The partnership includes a $300 million investment from Microsoft in NOOK Media LLC.

“As demand for digital content continues to increase, we are focused on bringing ground-breaking reading and learning content and technologies to more people in more formats than ever before, including the imminent launch of our exceptional NOOK reading application for Windows 8,” said William Lynch, CEO of Barnes & Noble. “We look forward to working closely with our new partner Microsoft to add value to their innovative new platform by bringing great reading experiences and one of the world’s preeminent digital bookstores to millions of Windows 8 users.”

“NOOK Media is a leader in developing the next generation of digital reading and we look forward to the company bringing one of the world’s largest digital libraries to Windows 8 devices via their upcoming Windows 8 app,” said Andy Lees, President at Microsoft. “We are also excited by NOOK Media’s product roadmap and expansion into markets around the world as demonstrated by their recent launches in the United Kingdom.”

Microsoft made its $300 million investment in NOOK Media LLC at a post-money valuation of $1.7 billion in exchange for an approximately 17.6% equity stake, with Barnes & Noble owning the remaining shares.

As previously announced,there is no set timetable for Barnes & Noble’s review of strategic options for its investment in NOOK Media LLC. There can be no assurance that the review will result in a strategic separation or the creation of a stand-alone public company. Barnes & Noble does not intend to comment further regarding the review unless and until a decision is made.

About Barnes & Noble, Inc.

Barnes & Noble, Inc. (NYSE: BKS ) , the leading retailer of content, digital media and educational products, operates 689 bookstores in 50 states. Barnes & Noble College Booksellers, LLC, a wholly-owned subsidiary of Barnes & Noble, also operates 667 college bookstores serving over 4.6 million students and faculty members at colleges and universities across the United States. Barnes & Noble conducts its online business through BN.com (www.bn.com), one of the Web’s largest e-commerce sites, which also features more than 3 million titles in its NOOK Bookstore™ (www.bn.com/ebooks). Through Barnes & Noble’s NOOK® eReading product offering, customers can buy and read digital books and content on the widest range of platforms, including NOOK devices, partner company products, and the most popular mobile and computing devices using free NOOK software. Barnes & Noble is proud to be named a J.D. Power and Associates 2012 Customer Service Champion and is one of only 50 U.S. companies so named. Barnes & Noble.com is ranked the number one online retailer in customer satisfaction in the book, music and video category and a Top 10 online retailer overall in customer satisfaction according to ForeSee E-Retail Satisfaction Index (Spring Top 100 Edition).

General information on Barnes & Noble, Inc. can be obtained via the Internet by visiting the company’s corporate website: www.barnesandnobleinc.com.

NOOK®, NOOK® HD, NOOK® HD+, NOOK Tablet™, NOOK Simple Touch™ with GlowLight™, NOOK Simple Touch™, NOOK Color™, Reader’s Tablet™, Best-Text™ Technology, VividView™, PagePerfect™, NOOK Store™, NOOK Bookstore™, NOOK Book™, NOOK Newsstand™, NOOK Magazine™, NOOK Newspaper™, NOOK Apps™, FREE NOOK Reading Apps™, NOOK Kids™, NOOK Digital Shop™, NOOK Cloud™, NOOK® for Web, Read In Store™, More In Store™, LendMe®, NOOK Books en español™, NOOK Study™, NOOK Library™, Lifetime Library™ and Read What You Love. Anywhere You Like™ are trademarks of Barnes & Noble, Inc. Other trademarks referenced in this release are the property of their respective owners.

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About Microsoft

Founded in 1975, Microsoft (Nasdaq “MSFT”) is the worldwide leader in software, services and solutions that help people and businesses realize their full potential.