Friday June 8, 2012

NEW YORK (AP) -- The founder and outgoing chairman of Best Buy announced his resignation from the board Thursday and said he may sell off his 20.1 percent stake in the beleaguered electronics retailer.

It’s the latest news to hit the Minneapolis company facing increasing competition from online retailers and a CEO scandal, and it removes one obstacle for a possible private equity takeover of the company. Shares fell nearly 8 percent in morning trading.

Richard Schulze, 71, has been with the company since its inception in 1966 and it its largest shareholder by far. The second largest holder, Fidelity Management & Research Co., has a 6.9 percent stake in the company.

"There is an urgent need for Best Buy to reinvigorate growth by reconnecting with today’s customers and building pathways to the next generation of consumers," Schulze said in a statement.

He initially announced in May that he would step down on June 21 at the company’s annual meeting after an investigation found he knew that the then CEO Brian Dunn was having an inappropriate relationship with a female staffer. At the time he said he would remain as chairman until after the company’s annual meeting on June 21 and as a director through the 2013 annual meeting.

On Thursday, he said he would walk away from both of those positions, effective immediately.

Best Buy said Hatim A. Tyabji, currently chairman of the audit committee, will replace Schulze as chairman immediately, rather than after the annual meeting as previously announced.