GameStop has raised its convertible note offering to $2.25 billion, increasing from the previously announced $1.75 billion, according to a press statement released on Thursday evening.
Essential Points:
- GameStop has increased its convertible note offering to $2.25 billion, featuring a 32.5% premium conversion price.
- The firm owns 4,710 Bitcoin but is cautious about future crypto purchases.
- Funds from this offering may be used for investments or acquisitions, with a focus on trading cards becoming central to revenue.
This decision comes a few months after the company raised $1.5 billion in April, and follows its recent foray into Bitcoin.
GameStop’s stock value dropped by 24% over the past week, closing at $22.14 on Friday, although it remained stable after the announcement.
The zero-coupon notes are issued without interest payments and have a conversion price of about $28.91 per share—a 32.5% premium compared to the average stock price from Thursday afternoon.
This strategy resembles that of MicroStrategy, which has successfully used premium note offerings to increase its Bitcoin holdings without causing immediate stock dilution.
In March, GameStop revealed it had acquired 4,710 Bitcoin, propelling its stock price above $28 at that time. It remains unclear if the company intends to further increase its cryptocurrency holdings.
CEO Ryan Cohen has emphasized that GameStop will not imitate the practices of other companies and has not given specific details about potential Bitcoin purchases in a recent interview.
The company’s press release left options open, mentioning that the funds would be redirected towards “general corporate purposes,” including investments that align with GameStop’s strategy and “potential acquisitions.”
The language used in the release is somewhat ambiguous, leaving room for potential digital asset maneuvers.
GameStop’s earlier endeavors in the crypto space have had mixed results. The company launched an NFT marketplace during the last market cycle but ceased operations early last year.
During its recent shareholder meeting, Cohen emphasized a shift towards trading cards, which now constitute nearly 30% of the company’s quarterly income.
“We’re emphasizing trading cards as a logical extension of our current business,” he stated.
With capital secured and existing crypto assets, GameStop might reconsider its Bitcoin strategies when market conditions are favorable.
223 Companies Hold Bitcoin
A growing number of companies are adopting Bitcoin as a method to hedge their balance sheets or as a strategic investment. Recent figures indicate that 223 public companies now possess Bitcoin, a rise from 124 just days prior.
In total, over 819,000 BTC, or roughly 3.9% of the Bitcoin supply, is held by public companies according to BitcoinTreasuries.NET.
MicroStrategy leads as the largest corporate Bitcoin holder with 580,250 BTC worth around $60.9 billion.
Other significant holders include Marathon Digital Holdings and Tesla, both owning Bitcoin valued at over $1 billion.
Last week, Japanese investment firm Metaplanet announced an ambitious target to gather 210,000 Bitcoin by the end of 2027.
As reported, companies in the digital asset space are flooding the capital markets to raise funds for substantial Bitcoin purchases, driven by the cryptocurrency’s surge to a record $111,965 the previous week.
This spike, which represents over a 50% increase since early April, has sparked a flurry of listings and mergers as firms rush to secure funding while investor interest remains high.
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