Liberty Media Corp. has a new attitude about books retailer Barnes & Noble Inc.: If you can’t buy them, at least buy into them.

In May, Liberty Media, which owns and operates QVC Corp., No. 8 in the Internet Retailer Top 500 Guide and several other growing e-commerce brands, had its eye on another prize: Barnes & Noble. At the time Liberty Media offered to pay $17 per share to acquire Barnes & Noble (No. 41). Liberty would have bought 57 million outstanding shares, which would put the value of the deal at about $969 million.

Now instead of purchasing Barnes & Noble, Liberty Media will invest about $204.0 million into Barnes & Noble by purchasing about 12.0 million shares of common stock at $17 per share. That will give Liberty Media 16.6% of the common stock of Barnes & Noble.

The deal was approved by Barnes & Noble’s board of directors Friday. “In light of Liberty’s investment, the parties have ceased discussions regarding Liberty’s previously announced acquisition proposal,” says Barnes & Noble chairman Leonard Riggio. “Their investment is a strong endorsement of our overall business and the additional capital will further fuel the explosive growth of our digital strategy.”

Liberty Media was especially interested in buying all—or at least a portion—of Barnes & Noble because of the retailer’s growing e-commerce and digital content business built around the Nook electronic book reader, says Liberty Media CEO Greg Maffei. “We are excited about Barnes & Noble’s prospects as the leading bookseller in the U.S. and its growth opportunities in the digital world,” says Maffei. “This investment provides Barnes & Noble with capital to grow its business on terms that are attractive for both parties and allows us to play a meaningful role in shaping their success to generate returns for our shareholders and theirs.”

As part of the deal Maffei and Liberty Media senior vice president Mark Carleton will join the board of Barnes & Noble, whose membership will expand from nine to 11.

For the 2011 fiscal year ended April 30, Barnes & Noble reported:

• E-commerce sales, which include the sales of Nook electronic book readers sold online and digital content, increased 49.8% to $858.1 million from $572.7 million in fiscal 2010. Barnes & Noble didn’t break out specific sales for Nook and its related digital content.
• Total sales grew year over year 20.5% to $6.99 billion from $5.80 billion.
• Retail sales declined 0.9% to $4.36 billion from $4.40 billion in fiscal 2010.