Best Buy Co. BBY -2.01%founder Richard Schulze is weighing whether to scrap a plan to take over the struggling electronics chain and instead line up investors to take a minority stake in the company, people familiar with the matter said.
Mr. Schulze has been working since last summer to secure financing to take Best Buy private but hasn't yet gotten enough support from banks to finance the deal, according to people familiar with those discussions.
He is Best Buy's largest shareholder with a roughly 20% stake in the company.
Talks with investors to take only a minority stake in the company are preliminary, the person said, and Mr. Schulze could choose a different path. Under that scenario, the stake Mr. Schulze buys with an investor group would likely be separate from his existing stake.
Any decision is still in the early stages, and Mr. Schulze could still go ahead with his initial strategy.
He has until the end of February to make a bid for the world's largest electronics chain by revenue, and the company's board then has 30 days to respond.
A Best Buy spokesman declined to comment, citing an agreement between Mr. Schulze and the company to refrain from speaking publicly while Mr. Schulze works to line up an offer.
In August, Mr. Schulze said he submitted a written proposal to buy the rest of the company he didn't already own in a deal that valued Best Buy at about $8 billion. At the time, Mr. Schulze said he was prepared to roll at least $1 billion of his own equity—and potentially all of his existing stake depending on the terms of agreements with private-equity firms—into the deal.
Twice, the company agreed to extensions that would give Mr. Schulze more time to line up private-equity firms that would partner with him on the deal and secure financing via banks.
Doubts have persisted about his ability to secure financial backing. Investment partners would need to commit substantial capital in a retailer facing multiple headwinds, and Mr. Schulze helped lead the company during its slow response to a changing market.
Best Buy shares are up around 30% year-to-date after Best Buy surprised Wall Street with stronger-than-expected holiday sales.