GameStop finishes $1.5B raise to add Bitcoin to its balance sheet
Video game retailer GameStop Corporation (GME) has finished a convertible debt offering that raised $1.5 billion, with some proceeds earmarked for buying Bitcoin.
The offering was initially set to raise at least $1.3 billion, but purchasers opted for an additional $200 million aggregate principal amount of notes, GameStop in an April 1 filing with the Securities and Exchange Commission.
"The company expects to use the net proceeds from the offering for general corporate purposes, including the acquisition of Bitcoin in a manner consistent with the Company's Investment Policy," GameStop added.
The convertible notes are debt that can later be converted into equity and are scheduled to mature on April 1, 2030, unless earlier converted, redeemed or repurchased.
The conversion rate for the notes will initially be 33 shares of Common Stock per $1,000 principal amount of notes, according to the filing.
GameStop shares didn’t see a significant move following the close of the convertible debt offering.GME closed the April 1 trading day up 1.34% at $22.61 and only saw an extra 0.5% bump after the bell, Google Finance data .
GameStop’s share price barely moved after sharing it closed the convertible debt offering. Source:
Positive shareholder to $28.36 on March 26, the day after GameStop announced its Bitcoin () plan, but its fortunes reversed the next day, with GME shares dropping nearly 24% to $21.68.
Analysts reflected shareholders' fear of GameStop's deeper problems with its business model.
GameStop joins growing Bitcoin move
On March 25, GameStop confirmed that it had to invest in Bitcoin and using the notes and its cash reserves. Those reserves stood at $4.77 billion as of Feb. 1, compared with $921.7 million a year earlier, to its 2024 fourth-quarter financial statements.
GameStop is a relative latecomer among public companies creating Bitcoin treasuries. A slew of to their balance sheets in a playbook popularized by .
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The video game retailer previously made forays into the crypto space with a for its users, which it eventually due to regulatory uncertainty.
GameStop is also considered the first example of meme stock success after a short squeeze in 2021 that sent the as traders flipped the table on hedge funds that had been making money shorting on the company.
