US video game retailer Gamestop, which hit the headlines after an extraordinary price rally, raised more than $ 1 billion on a stock sale. The long ailing company continues to benefit from the campaign of small investors organized on the Internet, which caused the share price to rise at the beginning of the year.
In the past few weeks, Gamestop sold five million shares for a total of just under 1.13 billion dollars (currently around 943.5 million euros). The Money is said to be used for “growth initiatives” and to strengthen the balance sheet as the company announced on Tuesday. Gamestop announced the sale of shares back in April.
The stock cost less than $ 20 at the beginning of January – and then rose to a peak of just under $ 350 within a few weeks before it began to slide. In early US trading on Tuesday, the price rose by over six percent to around $ 213 after the announcement and is now around $ 220.
From retail chain to technology provider for online gamers
Gamestop had been in a crisis with its stores for a long time. The game retailer wanted to close 200 branches in autumn 2019. Then the upswing, influenced by small investors, opened up new opportunities for the company earlier this year. Now the company wants to say goodbye to the dusty business model of a classic retail chain and to become a modern technology provider for online gamers.
Business at Gamestop has also been a little better recently. In the three months to the beginning of May, sales rose year-on-year by around a quarter to $ 1.3 billion. The company was still in the red, but reduced its loss within one year from $ 165.7 million to $ 66.8 million. Gamestop recently got a new management duo.