Best Buy Co., Inc. (NYSE:BBY)’s founder and former chairman, Richard Schulze, offered $24 to $26 a share to take the electronics retailer private. On the news of offer, the shares of the company rose by 34 percent in the early trading session. Schulze’s financial adviser on the buyout, Credit Suisse Group AG (NYSE:CS), is confident of arranging the finances for the transaction. The money is expected to come from “premier private-equity firms with deep experience in retail who are interested in a possible acquisition of Best Buy” and debt financing, according to a letter sent to the board by the Schulze. And about $1 billion will be contributed from Schulze, from the 20 percent stake he held in Best Buy.

Best Buy

The offer price by Schulze is around 36 percent greater than Best Buy Co., Inc. (NYSE:BBY)’s closing price Aug. 3. Taking the average price of the offer by Schulze, the equity value for the company comes to around $8.5 billion. Schulze said in the letter, “I have been actively exploring all available options for my ownership stake, that exploration has reinforced my belief that bold and extensive changes are needed for Best Buy to return to market leadership, and has led me to the conclusion that the company’s best chance for renewed success will be to implement these changes under a different ownership structure.”

The next step, Under Minnesota corporate law for Schulze, is to take permission from company directors to form a group, including private-equity funds and other executives, that would make a more complete offer. “With the board’s agreement that I may work together with potential private equity partners and former senior executives, and with timely access to relevant non-public company information, I am confident that the necessary due diligence could be completed expeditiously, and a binding agreement to acquire Best Buy could be reached quickly,” Schulze said. “I am prepared to enter into a customary confidentiality agreement and begin work immediately.”

According to a person familiar with the matter, Schulze has been asking for board’s permission for forming the group for quite some time now, but without much success. Best Buy Co., Inc. (NYSE:BBY)’s board has since rejected the request saying, it’s not the right time as the company is looking for a new CEO, and has asked three more weeks to consider the matter.

Schulze, 71, was associated with the company for almost half a century, resigned as chairman in June after an internal probe found he acted inappropriately in handling allegations about then-CEO Brian Dunn’s relationship with a female employee. At the time of his retirement, Schulze said he would consider all options, including selling his stake.

Best Buy Co., Inc. (NYSE:BBY) has been struggling to stay afloat as its customers are migrating to, Inc. (NASDAQ:AMZN) and other online merchants. For the year ending March, Best Buy posted a net loss of $1.23 billion on revenue of $50.7 billion, its first annual loss since 1991. To save on costs, company plans on closing 50 big-box locations in the U.S. this year.