Best Buy Co. said Tuesday it would pay $97 million to acquire Speakeasy, a broadband voice, data, and IT service provider, in order to improve its offerings for small business buyers.
Best Buy will add Speakeasy to its Best Buy For Business unit, providing one-stop shopping so entrepreneurs and small business customers are not forced to juggle multiple service providers, said Darren Jackson, Best Buy executive vice president and chief financial officer, in a statement.
Best Buy is weathering a slump in retail consumer electronics sales far better than its competitors. In recent weeks, Tweeter Home Entertainment Group, CompUSA, and Circuit City Stores all announced they would close many of their retail stores. In contrast, Best Buy said in February that it planned to open 130 new stores in the U.S., Canada, and China during its 2008 fiscal year, which began on March 4. That would add about 12,000 jobs and push the company's total employment over 140,000 people.
Speakeasy earned revenue of $80 million in 2006. The company opened in 1994 as an Internet cafe in Seattle, and soon grew to offer voice and data products including business-class broadband and VOIP (voice over Internet Protocol). Speakeasy now operates in most U.S. metropolitan areas, supporting 40,000 customers with its 300 employees.
Best Buy plans to retain Speakeasy's executive team, including CEO Bruce Chatterley, who will now report to David Hemler, a vice president in charge of the Best Buy for Business division.
Best Buy operates Best Buy for Business in 281 of its U.S. stores. The company has more than 1,150 retail shops including the U.S., Canada and China, all peddling consumer electronics, home-office products, entertainment software, appliances and IT services. The company expects this deal to close by June 19, the end of the first quarter of its 2008 fiscal year.