GameStop raises about USD1B in latest equity offering

GRAPEVINE, TEXAS (CNA) – Video game retailer GameStop said on Tuesday it raised about USD1.13 billion in an offering of five million shares, cashing in on a Reddit-driven surge in its stock price this year.

GameStop, whose shares are up more than 960 per cent this year, has become one of the hottest and most visible “meme stocks” followed on social media after its meteoric rise in a Reddit-driven retail short squeeze that caught Wall Street off guard in January. The company will use the net proceeds from the offering for general corporate purposes as well as for investing in growth initiatives, the company said.

GameStop is trying to pivot to e-commerce and recently named a chief executive and a finance head to steer it through the transition.

Shares of the company were up 9.3 per cent in pre-market trading on Tuesday.

A GameStop store in New York. PHOTO: AP