By Chelsey Dulaney 

Barnes & Noble Inc. will buy back Pearson PLC's stake in its flagging Nook division for about $27.7 million in cash and stock, as the largest U.S. bookstore chain prepares to split itself into two separate companies next year.

Pearson's exit follows Microsoft Corp.'s decision to sell its 16.8% stake in Nook Media LLC earlier this month for about $125 million in cash and common stock.

Pearson, which took a 5% stake in Nook Media in 2013 for $89.5 million, had a right to sell its stake back to Barnes & Noble for terms similar to the ones Microsoft received. The sale will return full interest in the unit to Barnes & Noble.

Barnes & Noble's separation into two companies--one consisting of 658 consumer stores and BarnesandNoble.com, and the other encompassing 714 college bookstores and the Nook digital business--is expected happen at the end of August 2015, instead of the earlier target of March.

The decision to split came as Nook's e-reader struggled to compete with bigger companies like Amazon.com Inc., resulting in a series of heavy losses for the unit.

Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com

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