Liberty Mutual Media opted to part ways with Barnes & Noble Book Stores on Thursday. In a disappointing and simultaneously frustrating move, Liberty Mutual sold off the majority of its shares in the company after just two years of partnership. This move finds Liberty Mutual guilty of not only a complete disregard of its corporate responsibilities, but also of heinously reckless money handling.
Even though things have been looking bleak for Barnes & Noble for a few years, the bookstore could still find solace in financial backing from the media conglomerate. Two years ago, Liberty Mutual tried to purchase a majority share in Barnes & Noble. However, it had to settle for a 17 percent stake, to the tune of $204 million.
In the after wake of the decision lies a Barnes & Noble in an even more desperate situation than before. For the next decade, the company will have to close an average of 20 stores per year.
Liberty Mutual’s lack of commitment to Barnes & Noble makes one thing clear: This deal was never about anything more than money. Honestly, that would have been fine if Liberty Mutual stuck through and tried a little harder to make the book retailer more profitable.
Liberty Mutual bought Barnes & Noble at the height of the Nook craze. The digital reader showed promise, but two years later Nook gave way to the iPad and other tablets. Barnes & Noble’s physical stores have also fallen to the wayside at the mercy of digital stores like Amazon and iTunes.
Liberty Mutual had no right to abandon Barnes & Noble. Even though the bookseller did not prove as lucrative as it once was thought to be, companies have a responsibility to work hard and stay committed to their projects. This kind of irresponsibility sets a bad example for future generations and the lack of repercussions to Liberty Mutual set a precedent for other corporations to abandon its subsidiaries at will.
The promise of quick and easy money persuaded the suits at Liberty Mutual to drop a staggering $204 million on Barnes & Noble. That says a lot, but what does it say that Liberty Mutual was as easily persuaded to drop its investment?
The answer is that money is not an object to companies like Liberty Mutual. This move makes it evident that $204 million is expendable — and that two short years is enough time to warrant that kind of financial activity.
To put it in perspective — Liberty Mutual shelled out $102 million a year to fund a fledgling company.
The most upsetting part about this is that it is all too easy to interpret this as some sort of display of power. Five years removed from the economic recession, Liberty Mutual has no problem spending millions of dollars — and then dropping its investment as though it means nothing.
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Editor’s note: The opinion presented in this column is the author’s and does not imply any endorsement from The State Press or its editors.
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