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GameStop shares slide on plan for 3.5 million share sale

GameStop Corp shares fell 13% on Monday (April 5) after the video game retailer said it may sell up to 3.5 million shares as it tries to take advantage of the stock price surge following a Reddit-driven trading frenzy earlier this year.

The share sale would fetch the company more than $670 million at Thursday’s (April 1) closing price of $191.45. The shares have gained more than 900% so far this year and had at one point hit $482.95 as retail traders bet against Wall Street hedge funds that had shorted the stock.

GameStop said it would use the proceeds from the share offering to speed-up the shift in its business model to e-commerce, a plan that is being led by top shareholder and board member Ryan Cohen.

The company said it has filed the at-the-market equity offering prospectus with the U.S. Securities and Exchange Commission.

Separately, GameStop said global sales for the nine-week period ending April 4 rose about 11%.

Its shares were down at $166 in premarket trading.

(Production: Martin Veal, Mindy Burrows)

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