GameStop Expands Convertible Note Sale to $2.25 Billion
GameStop has increased its convertible note sale to $2.25 billion,up from the initial $1.75 billion. The company announced this on June 12. These notes, due in 2032, will be sold privately to big investors. They don’t pay interest.
Buyers can also purchase an additional $450 million worth of notes. This could push the total to $2.7 billion. The sale is expected to close on June 17. After fees, GameStop will get about $2.23 billion. If the extra notes are sold, it will receive $2.68 billion.
The funds will be used for general business needs, like investments and possible acquisitions. While GameStop hasn’t confirmed plans to buy more Bitcoin (BTC), it follows an earlier sale in April. Then, it raised $1.5 billion and used part of it to buy 4,710 BTC worth $512 million.
GameStop’s shares fell 5% on June 12.Investors were concerned about potential dilution and the company’s focus on crypto. With declining retail sales, GameStop is investing in digital assets.
GameStop is among several public companies holding large amounts of Bitcoin.Its May purchase made it the 13th largest corporate holder, according to BitcoinTreasuries.net.
The notes have a conversion rate of $28.91 per share, a 32.5% premium over the average June 12 trading price. They don’t bear interest and can’t be redeemed until June 2029, unless certain conditions are met.
This offering gives GameStop more time and flexibility as it seeks to recover from declining sales in the gaming and retail space.
