News

Waterstone coy on bid for book chain

Tim Waterstone is reportedly pondering a bid to buy the bookstore he founded in 1982 with HMV billionaire investor Alexander Mamut.

In the recent past, Waterstone has distanced himself from a bid saying while he would be interested if it was put up for sale, it was an irrelevant question as the book chain was not available.

However, there has been growing speculation that Waterstone may bid for the chain, given his relationship with Russian billionaire investor Alexander Mamut, who has a 6.1% stake in HMV Group. Waterstone previously invested in Bookberry, a now bankrupt Russian chain.

When contacted by the Guardian on Saturday and asked if he was considering a bid with Mamut, Waterstone said: "I just can't comment at this stage. Sorry to be obtuse."

Stockbroker Arden Partners reiterated in its Daily Retailer email that the “best option” for the HMV Group is to sell Waterstones to raise money for up to £75million, which would rebalance a “shrunken HMV core business on the Live music and Digital assets.

It said: "HMV is in a dilemma, in that it would prefer to keep it but it needs to raise money and Waterstones is the one business it can sell."

Waterstone originally sold his book business in 1993 for £9million, bought it back becoming group chairman backed by HMV but then left again in 2001 over concerns about how the business was being run. Since then he has bid for the business four times, the most recent in 2006.

Comments: Scroll down for the latest comments and to have your say

By posting on this website you agree to the Bookseller comments policy. Comments go direct to live please be relevant, brief and definitely not abusive. Report any "unsuitable comments by clicking the links"

if Tim buys the company...Ws will be doomed for good. I understand the company is his "baby" but he has no clue about modern retail. If he buys, I'm leaving.

Waterstone's was indeed his baby.
They can only hope that he realises the business that he sold is not the same as the one that he may be buying back.

Is this the silver lining in the cloud. Someone who knows something about books and the book business! Not the idiots who have run the company down over the last few years. If it happens, someone who may even invest in his staff and not just expect them to be shelf stackers like current management do. Well, if it happens and if it's done right, perhaps in a couple of years Waterstone's will be a happier place to work. Thet may even invest money in my local branch which when I go in, has hazard tape on the carpoet because they don't seem to have any money on refurbishing the place since it was taken over. £1.9 million on advertsising did I hear? :)

He's got the passion, but I fear that it would be a step backwards for The Big W.

how one used to long for the days when one could choose a book in the comfort and serenity of a classy Waterstone's Bookshop; sadly those days are long gone with the classical music replaced by strident pop and the books themselves representing today's obsession with some woman called jordan. Intrusive questioning from staff about my reading proclivities are not appreciated either.

"By Anonymous
if Tim buys the company...Ws will be doomed for good. I understand the company is his "baby" but he has no clue about modern retail. If he buys, I'm leaving."

If you have any responsibility for the state of W now, you should leave.

Sadly Tim Waterstone's business acumen is not one that fills me with hope for the company. He failed to make his Daisy and Tom venture succeed. And more alarmingly his previous venture with Russian billionaire Mamut 'Bookberry' is now defunct after having to file for bankruptcy. Rumours that he is also talking to James Henage do nothing to alleviate these fears. If Waterstone's hadn't bought Ottakars it would have gone to the wall under mounting debts. Sadly grand passions aren't always long term business successes.

Apart from Ringo Starr Tim is the luckiest man alive . His chain never made a real profit when he ran it but it was sought by WHS because Pentos /Dillons wanted it badly . Smiths bought it to prevent Dillons , that's a fact incidentally. He cashed in and has been losing on retail investments ever since.

Having been there when Waterstone's were first bought out by WHS in the 80s I would have to agree with your assessment of Tim Waterstone's abilities but where do you get your "facts" about Ottakar's from? James tried desperately to buy the company back and he had the financial backing to do so. The company was profitable and would have remained so under a sensible and inspirational management team. I don't deny that high street bookselling is in a bad place at the moment and personally I am doubt very much that there is a future for a chain the size of Waterstones, but it is a fact that they have managed the chain to the state it is now in by disregarding the expertise of their staff and causing good people to leave. There is an article called "the cesspool syndrome: how dreck rises to the top in declining organisations" which basically says that bad management forces good people out and makes it impossible for a declining company to recover. Step forward and take a bow HMV...

"That's a fact"? I don't think so. It's certainly not how I remember it, and I was in WHS head office at the time. WHS already had a substantial book chain of its own, which it had built by buying up smaller chains and merging them - anyone remember Sherratt & Hughes? (No?? Just me then.) Waterstones was the logical next step in that process. WHS saw it as a strategic move, not as a way to get at Dillons. Witness the long-drawn-out project to bring Waterstones into the WHS warehousing and distribution network. At the time, WHS was planning on being in the specialist book chain business for the long haul. I doubt Pentos/Dillons was in a position to buy Waterstones anyway, and I'm sure WHS knew that.

Of course the way in which WHS made sure it could buy Waterstones for a bargain price is another, much more interesting story...

Actually after the re-branding it's the little w

I worked for Sherratt and Hughes! And then we were called Waterstones but we were still run in the same way, which was a very good way incidentally. The training I had from WHS was some of the best of my bookselling career. But then the 80s recession hit and the first thing they did was close their training facility (the old Singer place) and for me it was all downhill from there. When are companies going to learn that investing in their staff is even more important when times are hard?

Oops I just reread what I wrote and I just wanted to say that it wasn't all downhill for me personally. Wouldn't want to give the impression that I am writing this in the gutter, clutching my vodka bottle! I meant for the company of course.

glad we got that sorted out!

Actually, those chains with shops that are most like the "old school" Waterstone's, i.e Foyles and Daunt, are the only booksellers that are surviving the current meltdown, so I'd take issue with anyone that thinks that Tim's return would spell the beginning of the end. The one problem is that this traditional Waterstone's profile wouldn't fit with some of the more, shall we say, "mass market" towns, where sales are driven by value rather than range. I think would be a good thing, provided he has a good management team to support him. As for not understanding modern retail, where has the HMV-sponsored junta's approach got them? Did "Get Selling" improve Waterstone's sales? Has the Waterstone's card stopped the drift to Amazon? And what have the Hub, Linksave and thousands of hours spent stickering and destickering achieved? Time for a change I think.

Sherratt and Hughes was once a lovely family run bookshop known as Bowes and Bowes.

Oh I used to work for them as well! Bowes and Bowes was my very first bookselling job :-)

"anyone remember Sherratt & Hughes?"

Oh yes. In fact I remember Websters, most of whose branches were subsumed under the S&H name. The initials TC come to mind ...

There's no way Pentos ever had the money to buy Waterstones - the whole edifice was built on sand and they just staggered from one refinancing to the next.

Surely, GT, you could stfu at this stage?
I mean, have you nothing to do with yourself apart from comment inanely on this website?

Well if there is any hope of a Heneage - Waterstone alliance, let's keep fingers crossed! And for anyone who says Ottakras had problems with debts? What about Waterstones now? Now investments in the interior of ex-Ottakars strores. All staff on a pay freeze. No overtime. Recruitment on hold. :)

if Tim buys the company...Ws will be doomed for good. I understand the company is his "baby" but he has no clue about modern retail. If he buys, I'm leaving.

Anonymous,

Glad to hear you're leaving if someone who knows about books takes over. The reason Waterstone's is in such a state is becasue the supermarket boys think that the book trade is the same as er...retail, like cheap clothes, washing powder etc.. When I sell books I often come across customers who are amazed at the knowledge a good bookseller, i.e. me, has - sorry, needs. If you've been happy just to till bash, get the punters to buy whatever they pick up and foist a maximum of chickle-lit,celeb biogs, linksaves and now teacups and chocolate on them and compete for the silly 'incentives, all of which show a total lack of respect for the customers, then the book trade is better off without you. I'm sure you approve of the latest incentive - to send booksellers into the streets to tout for increased footfall. Meanwhile boxes in goods-in full of new stock can't be unpacked or sold because of staff shortage - because the staff is running around the streets with leaflets. It doesn't say anything about street touting in my contract, does it in your?

Waterstone's was indeed his baby.
They can only hope that he realises the business that he sold is not the same as the one that he may be buying back.

Is this the silver lining in the cloud. Someone who knows something about books and the book business! Not the idiots who have run the company down over the last few years. If it happens, someone who may even invest in his staff and not just expect them to be shelf stackers like current management do. Well, if it happens and if it's done right, perhaps in a couple of years Waterstone's will be a happier place to work. Thet may even invest money in my local branch which when I go in, has hazard tape on the carpoet because they don't seem to have any money on refurbishing the place since it was taken over. £1.9 million on advertsising did I hear? :)

He's got the passion, but I fear that it would be a step backwards for The Big W.

Actually after the re-branding it's the little w

how one used to long for the days when one could choose a book in the comfort and serenity of a classy Waterstone's Bookshop; sadly those days are long gone with the classical music replaced by strident pop and the books themselves representing today's obsession with some woman called jordan. Intrusive questioning from staff about my reading proclivities are not appreciated either.

"By Anonymous
if Tim buys the company...Ws will be doomed for good. I understand the company is his "baby" but he has no clue about modern retail. If he buys, I'm leaving."

If you have any responsibility for the state of W now, you should leave.

Sadly Tim Waterstone's business acumen is not one that fills me with hope for the company. He failed to make his Daisy and Tom venture succeed. And more alarmingly his previous venture with Russian billionaire Mamut 'Bookberry' is now defunct after having to file for bankruptcy. Rumours that he is also talking to James Henage do nothing to alleviate these fears. If Waterstone's hadn't bought Ottakars it would have gone to the wall under mounting debts. Sadly grand passions aren't always long term business successes.

Having been there when Waterstone's were first bought out by WHS in the 80s I would have to agree with your assessment of Tim Waterstone's abilities but where do you get your "facts" about Ottakar's from? James tried desperately to buy the company back and he had the financial backing to do so. The company was profitable and would have remained so under a sensible and inspirational management team. I don't deny that high street bookselling is in a bad place at the moment and personally I am doubt very much that there is a future for a chain the size of Waterstones, but it is a fact that they have managed the chain to the state it is now in by disregarding the expertise of their staff and causing good people to leave. There is an article called "the cesspool syndrome: how dreck rises to the top in declining organisations" which basically says that bad management forces good people out and makes it impossible for a declining company to recover. Step forward and take a bow HMV...

Apart from Ringo Starr Tim is the luckiest man alive . His chain never made a real profit when he ran it but it was sought by WHS because Pentos /Dillons wanted it badly . Smiths bought it to prevent Dillons , that's a fact incidentally. He cashed in and has been losing on retail investments ever since.

"That's a fact"? I don't think so. It's certainly not how I remember it, and I was in WHS head office at the time. WHS already had a substantial book chain of its own, which it had built by buying up smaller chains and merging them - anyone remember Sherratt & Hughes? (No?? Just me then.) Waterstones was the logical next step in that process. WHS saw it as a strategic move, not as a way to get at Dillons. Witness the long-drawn-out project to bring Waterstones into the WHS warehousing and distribution network. At the time, WHS was planning on being in the specialist book chain business for the long haul. I doubt Pentos/Dillons was in a position to buy Waterstones anyway, and I'm sure WHS knew that.

Of course the way in which WHS made sure it could buy Waterstones for a bargain price is another, much more interesting story...

I worked for Sherratt and Hughes! And then we were called Waterstones but we were still run in the same way, which was a very good way incidentally. The training I had from WHS was some of the best of my bookselling career. But then the 80s recession hit and the first thing they did was close their training facility (the old Singer place) and for me it was all downhill from there. When are companies going to learn that investing in their staff is even more important when times are hard?

Oops I just reread what I wrote and I just wanted to say that it wasn't all downhill for me personally. Wouldn't want to give the impression that I am writing this in the gutter, clutching my vodka bottle! I meant for the company of course.

glad we got that sorted out!

Sherratt and Hughes was once a lovely family run bookshop known as Bowes and Bowes.

Oh I used to work for them as well! Bowes and Bowes was my very first bookselling job :-)

I worked for Sherratt and Hughes in St Ann's Square, Manchester, in the 1970s.
I loved the place and the job, but decided against a career in bookselling to become a journalist.

"anyone remember Sherratt & Hughes?"

Oh yes. In fact I remember Websters, most of whose branches were subsumed under the S&H name. The initials TC come to mind ...

There's no way Pentos ever had the money to buy Waterstones - the whole edifice was built on sand and they just staggered from one refinancing to the next.

Actually, those chains with shops that are most like the "old school" Waterstone's, i.e Foyles and Daunt, are the only booksellers that are surviving the current meltdown, so I'd take issue with anyone that thinks that Tim's return would spell the beginning of the end. The one problem is that this traditional Waterstone's profile wouldn't fit with some of the more, shall we say, "mass market" towns, where sales are driven by value rather than range. I think would be a good thing, provided he has a good management team to support him. As for not understanding modern retail, where has the HMV-sponsored junta's approach got them? Did "Get Selling" improve Waterstone's sales? Has the Waterstone's card stopped the drift to Amazon? And what have the Hub, Linksave and thousands of hours spent stickering and destickering achieved? Time for a change I think.

Surely, GT, you could stfu at this stage?
I mean, have you nothing to do with yourself apart from comment inanely on this website?

Does the truth hurt? Or am I being inane because I'm stating the obvious? As one of the many people who has seen HMV ruin chains that took years of loyalty, hard work and committment to build up, I am entitled to say what I like.

Well if there is any hope of a Heneage - Waterstone alliance, let's keep fingers crossed! And for anyone who says Ottakras had problems with debts? What about Waterstones now? Now investments in the interior of ex-Ottakars strores. All staff on a pay freeze. No overtime. Recruitment on hold. :)

The Waterstones model never really worked. Publishers were mesmerised by big subscriptions when the chain started soon to be mesmerised by almost equally big returns. Its no good blaming any one individual or company for the failure of Waterstones, it was never going to work.

our branch consistently seemed to be returning mainstream stock that was either already on order, or would be re-ordered in the next day or two - complete and utter madness, and hardly designed to earn the shop a profit.

I started my bookselling career at Bowes & Bowes, then we changed to Sherratt & Hughes, Then Waterstones, I still work for the company after 27 years, I love my job, I cant see Tim or Henage making a go of the company.

it CERTAINLY is a fact that they have managed the chain to the state it is now in by disregarding the expertise of their staff and causing good people to leave. There is an article called "the cesspool syndrome: how dreck rises to the top in declining organisations" which basically says that bad management forces good people out and makes it impossible for a declining company to recover. Step forward and take a bow

it IS a fact that they have managed the chain to the state it is now in by disregarding the expertise of their staff and causing good people to leave. There is an article called "the cesspool syndrome: how dreck rises to the top in declining organisations" which basically says that bad management forces good people out and makes it impossible for a declining company to recover. Step forward and take a bow HMV...

As usual, the shopfloor staff have to deal with bad decisions made by people in offices who have no idea of how a bookshop works.
For examples, I give you:
Weekly p.o.s and price changes, requiring stickering and re-stickering of the same books sometimes three times in ten days.
Changes in promotions, with staff being informed on the day the changes should take place so that they have to re-do work that has already been done,
Returning of books that then come up on replenishment orders
Returning of books that have been selling
Mass ordering by head office of stock that branches have no hope of ever shifting in their stores...

I could continue, but it makes me want to hurt someone.

Please, let someone buy Waterstone's and let the individual branches order for their stores and choose the returns for their stores... having every store with similar stock just does not work.
Oh, and someone should admit the Hub has NEVER worked well.

*rant over*

The best thing would be a Tim Waterstone-Ottakar scenario. In the last years Waterstone management, including amazingly the curretn one who promised better, has fiddled, tried to micro-manage each bookseller's phrases to use with customers, filled shelves with empty boxes to hide their destocking, wasted booksellers' time on a massive scale, given them a search engine that customers laugh at, piled celeb biogs in instead of the books customers actually want. Our supermarket management think a book is a box - if a box has the word tea on it, you know it's tea, but often you need a bookseller to tell the customer what is in a book and whether that's the right one for them.
Now the shops are being emptied of stock every day, soon there will be more empty than full shelves. Even computer book sections, usually good sellers, are shrinking to less than a bay. If those thinking of buying Waterstones out, they should get on with it or there will be nothing left - not even the booksellers who actually know how to sell books rather than just bash the tills.

A Waterstone and/or Heneage-run company would certainly be a nicer place to work in (and probably shop in too). Even if they can't save the chain in its current size, I'm sure that they'd provide a more humane, inspirational leadership. But I don't think even they would restock the Computing section - haven't sales been steadily declining in this area, due to the increasing number of online tutorial and help sites?

All branches have been told that they can't do daily exception orders as they are all overstocked.

is this the beginning of the end?

Sounds like this was (yet again) a complete non-story.

From what I've seen on various share trading websites, the general consensus is that Mamut is happy to hear talk of a takeover as he's probably hoping that the share price will rise, enabling him to dump the shares he currently owns at a profit, or at least less of a loss than he currently faces were he to sell now.

I think there is still hope for the business in a slimmed down form, but the current management need to forget trying to re-invent the wheel (why waste time and money creating 4 new corporate values that are basically identical to your old 4 corporate values?) and get the Hub working right!

The current waterstones management, under the pretext of P.C.equality, shows a total disregard for the quality of their staff, including the staff they took over from Ottakars. In the time I've been a permanent part-timer I have worked with English lecturers, freelance photographers, archeologists, publishers, theatre designers and playwrights,journalists and writers. 'how did you end up here,' a customers asked. It's not how but why and when one works freelance it is very useful to have a very small, but fixed income. I and my friend only work 2 days a week but it is enough to pay the bills. The rest of the time we freelance.The question is, why do we work for £6 per hour when we could earn £10 or more in Aldi? The managers have no idea that the above mentioned people bring their huge and combined knowledge to the customer. Because they have to work in very competitive freelance fields they are used to thinking outside the box, to listen and to think creatively on their feet. Some temps who come in and who don't know the difference between the Pacific and the word specific, who ask not where but WHAT is 'Croshia'in travel and who stand around looking for Prince 'MacVelly'are actually doing damage to the bookselling business. They've holidayed in Dubai but can't find stuff on Phoenix because they type in 'Cecily' instead if 'Sicily'and have no idea where or what Sicily is. The 'dreck rising to the top' idea is well and truly what Waterstones has practiced. Even the human resources people with their fake tan and glassed-over eyes as they sacked people when Ottakars was being swallowed up were like something out of Star Trek. Some managers are put in specifically to treat their staff by threats to increase footfal/conversion, running around the shop waving a piece of paper, crying: ' that's the conversion you MUST do today.'I hope this sad story comes to an end soon before the current lot have their way and turn the last bookshop on the block into a trashy card shop.

While the customers base burns the once big W management fiddles with the small w - stick flowers on it, make it chic lit or goth - wha-eva. Women customers joked it looks like a droopy bum, men said it looks like droopy tits - wha-eva. The desperation for street cred is more than sad. It shows the level of those in charge. When I go into our local, large wATERSTONES I'm amazed by how much the staff know and how they enjoy telling me about the books. I used to say that when you look at staff in a shop you can tell who the management are - definitely not the case here. Perhaps the big bookshops should be sized down. That'll leave new room for individual small bookshops to come back with booksellers who really know their stuff instead of just making great big piles with inane slogans from week to week.

Mary Portas has got it right - she's recognised how good the booksellers are. But do the top dogs listen? It's a vindication for all those who sacrifice good wages to sell books. How about putting her in charge? She'd get rid of all those who inflate their managerial jobs with ideas that don't work. The book-buying public is not stupid. When I go into our local quite big waterstones I now find it hard to see beyond all the slogans and bits and pieces attached to the shelves,not to speak of the complicated multiple offers - some books have money off, are on a £4.49 offer and are 3 for 2, apparently all at the same time. I went into the shop with my dad. He saw a book he liked. It had £6 off. I wanted to surprise him and went back the next day and it was back at full price so I didn't buy it. The next time I went it was on 3x2. If I feel manipulated like that I feel that Waterstones don't deserve my money.

By the time I have read through all the shelf talkers and extraneous garbage stuck on the shelves I am well and truly fed up and can't be bothered to buy a book.

waterstones values... w have a peculiar talent for picking names and slogans.
Phoenix - incinerates itself
W'stones Phoenix = famous for crashing
Pegasus - a winged divine horse
Its rider Belleophon falls off the horse trying to get to the top of Mount Olympus ...
Get selling campaign - the name implied booksellers normally couldn't be bothered to actually try and sell books.Insulting to booksellers.
Spread the Word - prescribed exact and uniform wording to booksellers on how to address customers - as if all customers were the same - either equally clever or perhaps equally stupid?!
Managed to insult both booksellers AND customers.
NEW VALUES - 1.-'in love with waterstones...'.
Hey, guys! BRAND LOVE RULES
Can buy me love for £6 an hour???Pleeease??

As the various branches of waterstones where friends of mine work seem so desperate to increase footfall (picking people up in the street who have no intention of going into a bookshop only results in them having a bit of a browse in the front of the shop) we have had a great idea! Why not tell everyone you know to run in and out of the nearest waterstones every time they pass (as many times as their time allows)? That should do it.