Redmond-based Microsoft and bookstore operator Barnes & Noble said this morning that the two are in a strategic partnership, where Microsoft will invest $300M in a new subsidiary of Barnes & Noble. According to the companies, the yet-unnamed subsidiary called Newco, will include both the digital and College businesses of Barnes & Noble. The investment will give Microsoft an approximately 17.6 percent stake in the new venture. The two said the new company will include Barnes & Noble's NOOK digital reader business, and will be aimed at accelerating the transition to e-reading. As part of the deal, the two companies also said they have setlled their patent litigation. Microsoft had earlier sued Barnes & Noble over its NOOK e-reader and tablets for patent infringement.