GameStop Corp (NYSE:GME) shares were trading up approximately 2.7% at $23.61 Wednesday afternoon as investors continue to digest news of the company’s major new capital infusion. The move has recently fueled speculation that the company will use the funds to purchase more Bitcoin.
What To Know: According to a Form 8-K filing with the Securities and Exchange Commission late Tuesday, the video game retailer has completed a private offering of $2.25 billion in convertible senior notes.
The unsecured notes, which carry a 0.00% interest rate and mature in 2032, have provided GameStop with net proceeds of roughly $2.23 billion. The company stated the funds are earmarked for general corporate purposes, which could include investments or strategic acquisitions consistent with its investment policy.
Read Also: GameStop Highlights Trading Cards As Next Growth Segment At Annual Meeting, Not Bitcoin
The notes are convertible into common stock at an initial price of approximately $28.91 per share. This represents a 32.5% premium over the stock’s volume-weighted average price on June 12, and sits well above its current price. The company may not redeem the notes prior to June 20, 2029.
This strategic move meanwhile provides GameStop with a substantial cash war chest as it navigates its ongoing business transformation. GameStop recently said it used cash to purchase 4,710 Bitcoin subsequent to the end of the first quarter.
Related Link: GameStop’s Bitcoin Strategy Draws Skepticism Amid $1.75B Debt Offering
How To Buy GME Stock
Besides going to a brokerage platform to purchase a share – or fractional share – of stock, you can also gain access to shares either by buying an exchange traded fund (ETF) that holds the stock itself, or by allocating yourself to a strategy in your 401(k) that would seek to acquire shares in a mutual fund or other instrument.
For example, in GameStop’s case, it is in the Consumer Discretionary sector. An ETF will likely hold shares in many liquid and large companies that help track that sector, allowing an investor to gain exposure to the trends within that segment.
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