GameStop Corp. has completed a $1.5 billion private offering of convertible senior notes, with proceeds partially allocated toward acquiring Bitcoin and U.S. dollar-pegged stablecoins. The move follows board approval granted on March 25 to invest in digital assets using the offering and existing cash reserves.
The company finalized the offering on April 1, according to a regulatory filing. Initially targeted at $1.3 billion, investor demand drove an additional $200 million in notes. Net proceeds totaled $1.48 billion after accounting for discounts and expenses. GameStop stated the funds will be used for general corporate purposes, including cryptocurrency purchases under its investment policy.
The unsecured notes carry no regular interest and mature on April 1, 2030. Holders may convert the notes into shares of GameStop’s Class A common stock under specific conditions, including stock price thresholds and corporate events.
The initial conversion rate is 33.4970 shares per $1,000 of principal, equivalent to a conversion price of $29.85 per share—a 37.5% premium over the average stock price on March 27.
Share Performance and Investor Response
GameStop’s share price reflected little enthusiasm after the deal closed. Shares closed April 1 at $22.61, up 1.34%, with only a modest 0.5% increase in after-hours trading. The stock had spiked nearly 12% to $28.36 on March 26 following the company’s announcement of its Bitcoin investment plan, but fell nearly 24% the next day to $21.68.
The firm’s fourth-quarter financials show a significant cash reserve of $4.77 billion as of February 1, up from $921.7 million a year earlier. This liquidity provides flexibility to execute the crypto investment strategy.
The notes, issued under an indenture with U.S. Bank Trust Company as trustee, allow for conversion before January 1, 2030, only under specified conditions, including sustained stock performance or redemption events. After that date, conversion is permitted at any time. The company may redeem the notes starting April 6, 2028, if its stock price remains at least 130% of the conversion price for a defined period.
Holders also have repurchase rights on April 3, 2028, and in the event of a “fundamental change” such as a merger or significant asset sale. The notes are not backed by a sinking fund, and events of default include missed payments, failure to convert, and specified insolvency or restructuring actions.
GameStop offered and sold the notes to qualified institutional buyers under Rule 144A, relying on exemptions from SEC registration. A maximum of 69,087,450 shares could be issued upon full conversion, based on an adjusted conversion rate.
The company’s strategy places it among a growing cohort of public firms adding Bitcoin to their balance sheets, expanding on earlier, short-lived crypto efforts such as its now-defunct wallet product.
