Microsoft deal may bring Barnes & Noble's Nook to UK

Barnes & Noble, the US bookstore chain, stoked speculation about the imminent launch of its Nooke-reader in the UK when it signed a new partnership deal yesterday with Microsoft.

Under the deal, Microsoft will invest $300m (£185m) in the Nook business, in return for a 17.6 per cent stake that values the business at $1.7bn.

B&N boss William Lynch said the cash would be used to fund international expansion. "Clearly we think the biggest opportunity is through this partnership in terms of growth internationally," he said.

B&N created the Nook as a rival to Amazon's Kindle e-reader, and has set up an online bookstore to deliver digital books to the device.

Those books will also now be readable on a Nook app for computers, tablets and phones that use Microsoft's forthcoming Windows 8 operating software.