Seems, flourishing e-book business is fascinating the Redmond giant. If reports are to be believed, Microsoft Corp will invest $605 million over five years in Barnes & Noble Inc's Nook e-reader and college business. 

In turn, the latest move can help the bookseller to compete against Amazon.com and Apple in the e-reader market by getting a much-needed capital injection. In addition, it will also get a chance to foray digital books market outside the United States. 

Sources informed, the new unit would be run and majorly owned by Barnes & Noble. The company will continue maintaining its relationship with the U.S. bookstore chain which includes nearly 700 stores.

Initially, Microsoft will make an investment of $300 million, which will give it a 17.6 percent stake in the newly created Barnes & Noble subsidiary, values the new unit at $1.7 billion.

According to William Lynch, Chief Executive at Barnes & Noble, the investment would go primarily to fund the international rollout of the Nook's digital bookstores and new reading software for the Windows platform. 

Market watchers added, Microsoft’s latest move has come just six months before the Redmond giant is due to launch its new touch-enabled Windows 8 operating system.

It is worth noticing, the integration of a Nook app on Windows tablets will give tough competition to Apple's iPad and Amazon's Kindle Fire. Moreover, it will also provide a direct interest to Microsoft in electronic publishing. 

Seems, with latest move, Microsoft is mulling to challenge Amazon's dominance of the e-book industry. 

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