Cable news network CNBC continues to feed the buyout rumor mill even as it pulls back from earlier claims.
Most recently, CNBC's Bob Pisani lit up a new rumor Wednesday via "Squawk on The Street" concerning book retailer Barnes & Noble. The CNBC report cites Credit Suisse analyst Gary Balter, who raised his rating on the retailer. One of the reasons for the rating change, an "outside" chance of a leveraged buyout.
At least with the Barnes & Noble rumor, there may be a glimmer of truth — unlike last week's rumor concerning Home Depot. After all, New York hedge fund, Pershing Square Capital Management, last month increased its stake in both Barnes & Noble and its chief rival Borders. While The Deal reported that Pershing's stake is passive, the firm has a history of grousing for change. Last year, it took a stake in McDonald's and succesfully pushed the fast-food chain to spin off its Mexican food business Chipotle Mexican Grill. Despite Pershing's activism, The Deal reported that most on Wall Street don't expect a Barnes & Noble buyout.
Last week, CNBC initially put fuel on the fire when Charles Gasparino first suggested that home improvement retailer Home Depot may be a buyout candidate for KKR and TPG. The deal's staggering $100 billion price tag led bloggers, journalists and even dealmakers to question the validity of the rumor ultimately leading CNBC's David Faber to throw water on the speculation on Tuesday.
So don't be surprised if Faber refutes his colleague again next week. —Matthew Wurtzel
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