The world’s largest video game maker just gave up on trying to sell itself.
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On Tuesday, GameStop announced that its board of directors has “concluded” its efforts to pursue a sale of the company due to the lack of available financing on “terms that would be commercially acceptable to a prospective acquiror.”
| Ticker | Security | Last | Change | %Chg |
|---|---|---|---|---|
| GME | GAMESTOP CORP | 11.78 | -3.72 | -24.00% |
Shares tumbled more than 20 percent in premarket trading on the news.
However, in the company’s release on the sale abandonment plans, the company didn’t lay out strategic alternatives.
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Instead, it said that its board, together with outside financial and legal advisers, “commenced a review of a wide range of alternative to enhance shareholder value.”
Part of that process, it added, was selling its Spring Mobile business, which was completed earlier this month and generated around $735 million in immediate cash proceeds.
“The Board continues to evaluate the optimal use of these proceeds, which could include reducing the company’s outstanding debt, funding share repurchases, reinvesting in core video game and collectibles businesses to drive growth, or a combination of these options,” the company said.
Furthermore, it added that it’s also on the hunt for a new and “highly qualified” CEO.
Like a slew of other brick-and-mortar retailers, GameStop has suffered from online competition in recent years, dragging it sales down.
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GameStop currently operates over 5,800 stores across 14 countries.
