Founder and former chairman Richard Schulze has proposed to take the company private in an effort to save Best Buy. In August, his first bid to buy out the company private was rejected by the board, but he was given until February 28 to deliver a second offer.
However, if Best Buy’s board does not accept Schulze’s proposal and follows the “muddle-through strategy,” it must cut costs. Currently, the electronics retailer has three times the number of employees of Google (NASDAQ:GOOG) and only 2 percent of its market capitalization.
Cramer supports his argument by analyzing Research in Motion’s (NASDAQ:RIMM) tentative return to profitability. Mid-way through last year, shares of the BlackBerry manufacturer were trading around $6 per share and downgrades were piling up. “But late last year, this company got religion and starting firing people and closing plants while at the same time revealing that it simply hadn’t lost nearly as many subscribers as people thought,” he wrote. Subsequently, shares rose to $14, and the stock continued to make gains after RIM announced that it may leave the hardware business.
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