GameStop finishes $1.5B raise to add Bitcoin to its balance sheet

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bitcoin-usd/”>BITCOIN BOOM: GameStop Drops $1.5 Billion on Crypto

GameStop finishes $1.5B raise to add Bitcoin to its balance sheet

Well, isn’t this just peachy? Video game retailer GameStop Corporation (GME) has finished a convertible debt offering that raised a whopping $1.5 billion, with some proceeds earmarked for buying Bitcoin. Because, you know, what could possibly go wrong with a company that’s already struggling to stay afloat sinking more money into a highly volatile asset. 🤑

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 said in an April 1 filing with the Securities and Exchange Commission. Because who needs a little thing like fiscal responsibility when you can have Bitcoin, am I right? 🤷‍♂️

“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. Because, you know, that’s exactly what the company needs: more Bitcoin. I mean, who needs cash flow when you can have a bunch of digital coins? 💸

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. Which is just a fancy way of saying “we’re going to stick you with this debt for a long time, and hope you don’t notice.” 😬

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. Because who needs a simple conversion rate when you can have a complicated one? 🤔

GameStop shares didn’t see a significant move following the close of the convertible debt offering. Which is just what the company needs: a lack of excitement. 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 shows. Because who needs a big bump when you can have a tiny one? 🚀

Positive shareholder sentiment saw the stock jump nearly 12% to $28.36 on March 26, the day after GameStop announced its Bitcoin (BTC) plan, but its fortunes reversed the next day, with GME shares dropping nearly 24% to $21.68. Because who needs a positive sentiment when you can have a negative one? 😔

Analysts at the time suggested the chilly reception reflected shareholders’ fear of GameStop’s deeper problems with its business model. Which is just a fancy way of saying “we’re going to stick you with this debt and hope you don’t notice.” 🤑

On March 25, GameStop confirmed that it had received board approval to invest in Bitcoin and US-dollar-pegged stablecoins 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, according to its 2024 fourth-quarter financial statements. Because who needs cash reserves when you can have Bitcoin? 💸

GameStop is a relative latecomer among public companies creating Bitcoin treasuries. A slew of others have already added Bitcoin to their balance sheets in a playbook popularized by Micheal Saylor’s Strategy. Because who needs originality when you can copy someone else’s playbook? 📚

The video game retailer previously made forays into the crypto space with a crypto wallet for its users, which it eventually shut down in November 2023 due to regulatory uncertainty. Because who needs a crypto wallet when you can have a bunch of debt? 🚫

GameStop is also considered the first example of meme stock success after a short squeeze in 2021 that sent the stock surging over 1,000% in a month as traders flipped the table on hedge funds that had been making money shorting on the company. Because who needs a solid business model when you can have a bunch of hype? 🚀

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2025-04-02 09:04