Simply put
- GameStop has increased its latest offering of convertible senior notes from $1.75 billion to $2.25 billion.
- GameStop shares remained steady on Friday, though they dropped 24% over the past week.
- Last month, GameStop purchased 4,710 Bitcoin.
GameStop announced it has upsized its offering of Convertible Senior Notes from $1.75 billion to $2.25 billion. This update was shared in a press release late Thursday.
This move came after a Texas-based investor suggested a similar, more convertible bond offering, which totaled $1.5 billion in April.
While GameStop shares held steady on Friday, they experienced a 24% decline throughout the week, closing at $22.14. Earlier, the stock had traded around $28.36, and it was noted that the company had started buying Bitcoin in late March.
The new convertible bonds might adjust the conversion price to approximately $28.91 per share, which, interestingly, doesn’t include any interest. GameStop indicated in a press release that this represents a 32.5% premium compared to the stock’s average price as of Thursday afternoon.
Following a strategy similar to MicroStrategy, GameStop aims to enhance the Bitcoin holdings per share, presumably to increase shareholder value.
However, there remains some ambiguity regarding whether GameStop will continue to buy Bitcoin. The company did purchase 4,710 Bitcoin last month, but CEO Ryan Cohen stated in recent interviews that there won’t be any indications or plans announced for future acquisitions of major cryptocurrencies.
In the press release, GameStop emphasized that the revenue from this offering will be used for corporate purposes, including potential investments and acquisitions.
As a brick-and-mortar retailer, GameStop has aimed to diversify beyond just video gaming and console sales by launching an NFT marketplace a while back, which ultimately was shut down early last year. Recently, during the annual shareholders meeting, Cohen mentioned that GameStop would also begin accepting trading cards, which contribute to around 29% of its quarterly sales.
“We see trading cards as a natural extension of what we already do,” he noted. “Whether it’s sports, Pokémon, or collectibles, the trading card market aligns well with our heritage.”
