Best Buy Co. Inc. (NYSE: BBY) founder Richard Schulze will not make an offer to buy a large stake in the company in exchange for three board seats, according to The Wall Street Journal. He started the consumer electronics retailer in 1966 and has run it, even when he was not CEO, since then. The Best Buy proxy shows he own 20.24% of outstanding shares. Why did he abandon his plan? He must have decided Best Buy’s troubles were too deep. Incidentally, they were troubles he helped create.

Schulze suggested he and a group of private equity investors would set a deal that valued Best Buy at $8 billion. The firm’s market cap is $5.6 billion today. Schulze would need to expect a tremendous turnaround to justify such a premium. The chances of that turnaround are gone already.

Stockholders are not the only ones that have rejected a better future for Best Buy than the current one. Credit rating agency Fitch cut Best Buy’s rating to BB- with a negative outlook late last year. Among other things, Fitch believed that plans articulated by new management were not impressive. In addition to a drop in Best Buy’s holiday sales, results from the most recently reported quarter were poor. All new CEO Hubert Joly has to tell analysts was that he would:

… outline that Best Buy aspires to achieve over time an operating margin of five to six percent and a return on invested capital of 13 to 15 percent. In the short term, the company’s goal will be to stabilize and then begin increasing its comparable store sales and operating margin.

The plan was pitifully short on details and consequently hard to believe and rely on as a reason to take a position in the shares.

It has to be granted that Best Buy shares are up nearly 30% over the past three months. But Schulze walked away from Best Buy because he saw it has no future and, as an investment, could not justify the stock price increase.

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