GameStop to Buy Web Retailer Geeknet in $140 Million DealKevin Orland
GameStop Corp., the largest U.S. video-game specialty retailer, agreed to buy online merchant Geeknet Inc. in deal valued at about $140 million to add memorabilia that appeals to many of its current customers.
Geeknet terminated a previous agreement to be bought by Hot Topic Inc., and GameStop will reimburse Geeknet for the breakup free associated with that deal, the companies said Tuesday in a statement. The Hot Topic bid had a $122 million equity value.
The acquisition combines GameStop’s 6,600 stores with a retailer that sold $140.7 million of geek-chic merchandise last year, mostly through its ThinkGeek website. GameStop is betting that ThinkGeek’s offerings, which include “World of Warcraft” pint glasses and “Mass Effect” hoodies, will be an easy sell to its customer base of avid video-gamers.
Hot Topic last month offered $17.50 a share for Fairfax, Virginia-based Geeknet. A day later, Geeknet said that it had received a $20-a-share bid, without identifying its new suitor. The online retailer’s board deemed the latter offer a superior proposal and gave Hot Topic until Monday to respond.
Geeknet had agreed to pay a 3 percent breakup fee to Hot Topic if the board terminated the agreement.
Shares of Grapevine, Texas-based GameStop rose 1.2 percent to $43.97 at the close in New York. Geeknet added 0.3 percent to $19.84.
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