GameStop (NYSE:GME), the struggling videogame retailer, announced that it had generated nearly $933.4 million by selling 45 million shares, sparking a 15% surge in its shares after the bell on Friday.
The company had previously disclosed its plan for a share sale earlier this month amidst a retail buying frenzy, triggered by the return of “Roaring Kitty” Keith Gill on social media. Gill’s bullish calls on GameStop were instrumental in the meme stock rally of 2021.
The deal was structured as an “at-the-market” offering, meaning the shares were sold at the prevailing market price rather than at a pre-determined one.
GameStop shares, emblematic of retail investor enthusiasm, began surging after Gill shared a meme and several video clips from movies. Although the stock quadrupled from the end of April through May 14, it subsequently retreated about 60% of that gain by Friday’s close.
While GameStop did not disclose the specific sale price of the shares, Reuters calculations suggest they were sold at an average price of $20.74 each, with the current trading price at $21.93.
The company intends to utilize the proceeds from the sale for general corporate purposes, which may include acquisitions and investments.
In a similar move, theater chain AMC, another favorite among retail investors, recently completed a $250 million “at-the-market” share sale program.
Featured Image: Unsplash
