Microsoft has invested $300 million in a new partnership with bookseller Barnes & Noble, with the companies intending to spin-off the digital Nook and College businesses.
Barnes & Noble shares skyrocketed after the announcement, rising more than 80% in after hours trading.
The investment will bring Microsoft’s stake in the new company to 17%.
“The formation of [this new subsidiary] and our relationship with Microsoft are important parts of our strategy to capitalize on the rapid growth of the NOOK business, and to solidify our position as a leader in the exploding market for digital content in the consumer and education segments,” Barnes & Noble chief executive William Lynch said in a statement.
“Microsoft’s investment in Newco, and our exciting collaboration to bring world-class digital reading technologies and content to the Windows platform and its hundreds of millions of users, will allow us to significantly expand the business.”