A Nook deal Microsoft and Barnes & Noble struck with much fanfare less than three years ago has deflated, after failing to achieve its lofty goals in the e-reader market.

After plunking down $300 million for an almost 18 percent stake in Nook Media in April 2012, at a stratospheric valuation of $1.7 billion, Microsoft has agreed to sell back its share to Barnes & Noble, which continues with its plan to spin off the money-losing business as an independent public company.

As part of the termination agreement announced Thursday, Microsoft will receive $62.4 million in cash and 2.73 million shares of Barnes & Noble common stock, plus payments of undetermined amounts for several years contingent on Nook Media sales.

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