The Channel logo

News

By | Anna Leach 8th June 2012 11:43

Best Buy founder flees troubled tech supermarket

Richard Schulze cashes in his microchips

Richard Schulze, the man who built tech megastore chain Best Buy out of an audio store he set up in Minnesota in 1966, has exited the company abruptly - causing the shares to take a hit.

Falling profits, a troubled a withdrawal from Europe and sex scandal allegations that took out Best Buy's CEO Brian Dunn have tamed the retail monster in the past year. Now the sudden departure of its founder can be added to the list of woes.

Schulze's exit is unexpected as he had intended to remain as chairman of the company until the end of this month and as a director for a year after that, Best Buy explained in a statement.

Schulze's 20.1 per cent stake in the company is understood to be up for grabs. He previously served as Best Buy's CEO, chairman and a director for 36 years until 2002. Since then, he had been chairman and a director.

On the news, Best Buy's [BBY.N] shares fell more than $1 to $18.75 in pre-market trading. Best Buy's financial performance has been rocky: for the year ending May 2012, Best Buy raked in revenues of $50.7bn (£32.8bn) but managed to notch up a $1.06bn (£688m) loss.

Best Buy's exec leadership was shaken up only a month ago when CEO Brian Dunn left amid claims of an "inappropriate relationship" with a female employee that showed "extremely poor judgement". The allegations emerged from a company audit committee report published in May. The internal probe concluded that his behaviour was damaging employees' morale.

Schulze has been replaced as chairman of the doard of directors by Hatim A Tyabji, formerly chairman of Best Buy's audit committee and the company's compensations and human resources board. ®

comment icon Read 4 comments on this article alert Send corrections

Opinion

Alexandre Mesguich

Change is order of day as tech giants shift strategy gears
Partnership

Frank Jennings

Confused? No problem, we have 5, no 6, no 7... lots of standards

Chris Mellor

VC sequence could end not with a bang, but a whimper
Sad man stares glumly over boxed contents of desk. Image via shutterstock (Baranq)

Features

Roll up, roll up, get your exclusive market insights
Wile E. Coyote goes over the edge again
money trap conceptual illustration
Big boys snare the unwary with too-good-to-be-true deals
Angus Highland cow
Pet carriers not wanted for whitebox stampede