An activist investor has acquired a stake in Barnes & Noble and is calling on the retailer to consider selling itself in order to unlock more value in the brick-and-mortar book business.
"Physical books, and physical bookstores, are not going away anytime soon," Sandell Asset Management said Tuesday in a letter to the retailer's board.
Barnes & Noble's real estate is like "beachfront property" that could provide value to an internet or media company looking to grow its retail presence, Sandell added.
The Wall Street Journal first reported Monday evening that Sandell had recently started buying a stake in Barnes & Noble and that it was already among the retailer's 10 biggest investors, based on conversations the publication had with people familiar with the matter.
Shares of Barnes & Noble were climbing around 11 percent shortly after market open Tuesday on this news.
"Neither Mr. Sandell nor anyone from his hedge fund has reached out to us yet, but we welcome constructive dialogue with all of our shareholders," Mary Ellen Keating, a spokeswoman for Barnes & Noble, said in a statement to CNBC.
Sandell confirmed Tuesday it had accumulated a "meaningful" stake in Barnes & Noble and said that the bookseller could fetch a price of $12 per share, or possibly higher, in a private deal. Though Sandell has declined to disclose the size of its investment, it would fall below the 5 percent threshold required by the Securities and Exchange Commission to file a 13D, making the investment less than $26 million.
Barnes & Noble's stock closed Monday at $7.10 per share. The stock is down more than 30 percent over the past year, including Tuesday's gains.