Following market interest, the Texas-based company GameStop revised its offering, setting the new total at $2.25 billion, a $500 million increase. The decision to increase the amount came just two months after the company raised $1.5 billion through a similar method in April. This new offer is aimed at institutional investors and follows the rules set out under Rule 144A of the U.S. Securities Act of 1933.
Image 1 (Source: X)
Retailer Plans to Boost Capital With Larger Note Sale
The notes are being issued privately and are expected to close on 17 June 2025, assuming standard closing procedures are met. Late on Thursday, the firm disclosed the update through a formal communication to investors. The funds raised will help support general operations, acquisitions, and investments aligned with the company’s financial policies.
During the week leading up to the announcement, GameStop’s share price dropped significantly. The company’s stock closed at $22.14 on Friday, reflecting a 24% decline over the week. This marks a noticeable fall from March, when its shares had climbed to $28.36 after the firm suggested it may explore buying Bitcoin.
Terms of the Notes and Conversion Features
These convertible notes are set to mature in June 2032. They are unsecured, carry no ongoing interest payments, and will not increase in face value over time. Investors who purchase the notes are granted the right to convert them into GameStop’s Class A ordinary shares under specific conditions.
Holders can only convert the notes before 15 March 2032 if particular criteria are satisfied. Once March 15, 2032 arrives, bondholders may choose to convert their notes into stock at any time before they mature. On conversion, GameStop can choose to provide cash, shares, or a mixture of both, depending on what it considers most suitable.
Investors will be able to convert each $1,000 worth of notes into roughly 34.5872 GameStop shares under the initial terms. That translates to a conversion price of approximately $28.91 per share, reflecting a 32.5% premium on the average trading price of GameStop stock between 1:00 p.m. and 4:00 p.m. Eastern Daylight Time on 12 June 2025.
Under certain circumstances—such as mergers, takeovers, or redemptions—the company may offer an enhanced conversion rate to noteholders who choose to convert during those specific events. These adjustments are designed to protect investors from dilution or loss of value caused by corporate changes.
Redemption Rights and Use of Proceeds
Until 20 June 2029, GameStop isn’t allowed to redeem the notes. After this date, redemptions are allowed only if the company’s share price trades at least 130% above the conversion price for a minimum of 20 out of any 30 trading days. If these terms are met, GameStop may redeem some or all of the notes at full value, along with any special interest that may apply.
For a partial redemption to be valid, at least $100 million in notes must remain outstanding and unaffected by the redemption. There is also no sinking fund tied to these notes, meaning the company is not obligated to set aside funds to repay the debt at maturity.
In addition, bondholders are given further security in the form of repurchase rights. Come 15 December 2028, investors can require GameStop to repurchase their bonds at face value, with unpaid interest added on. This one-time option offers an exit opportunity before the notes mature in 2032.
$GME GameStop just locked in the terms for their convertible note offering.
Upsized to $2.25 billion from the original $1.75B, with 0.00% interest, meaning bondholders don’t get paid unless they convert.
GameStop gave buyers the right to purchase up to $450M more in notes… pic.twitter.com/qnN4pVLM39
— Han Akamatsu 赤松 (@Han_Akamatsu) June 13, 2025
If GameStop undergoes a major event such as a corporate sale or restructuring—a situation defined as a “fundamental change” in the bond terms—noteholders will also be able to demand early repayment in cash. This condition ensures that investors maintain control in cases where the company’s direction changes significantly.
Should the underwriter choose to take up their option to purchase an extra $450 million in notes, the total proceeds from the offering could rise to around $2.68 billion. The company projects it will retain approximately $2.23 billion from the offering after all necessary expenses are factored in.
Image 2: (Source: 99Bitcoins)
Capital Strategy and Market Positioning
The offering is part of a broader effort by GameStop to build a stronger financial foundation. By issuing convertible bonds that carry no interest but offer share conversion options, the company can raise money without immediate dilution of existing shareholders or heavy borrowing costs.
The move does come with some short-term stock volatility. However, the funds could prove essential as GameStop seeks to reposition itself within the evolving retail and digital investment space. While no specific acquisitions have been announced yet, the company’s leadership has made it clear that the capital will be used to support its long-term goals.
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GameStop has not registered the convertible notes or any related shares for public trading in the U.S., nor does it plan to. As such, these securities can’t be sold publicly unless a legal exemption applies or they are formally registered at a later date.
