Geeknet Inc. has accepted an offer of $140 million from GameStop Corp. for all outstanding common stock. The GameStop offer, announced today, signaled an about-face from a $122 million purchase offer from Hot Topic that Geeknet accepted last week.
Geeknet, the parent company of web-only electronics and gadgets retailer ThinkGeek.com, on May 27 said it received a superior offer from an unnamed potential buyer, which turned out to be GameStop, a specialty retailer of video games and consumer electronics. GameStop’s offer of $20 per share bested Hot Topic’s $17.50 offer and was accepted by the board of directors for Geeknet and GameStop. Geeknet also operates ThinkGeek Solutions, which distributes video game-themed merchandise through licensed online stores.
Geeknet will pay Hot Topic a termination fee, for which GameStop says it has agreed to reimburse Geeknet. Hot Topic did not respond to a request for comment.
“The addition of Geeknet is an important expansion of our global multichannel platform and we are excited to leverage their product development expertise to broaden our product offering in the fast-growing collectibles category and deepen relationships with our existing customer base,” says Paul Raines, CEO of GameStop.
GameStop says the deal will drive deeper engagement with GameStop’s core customers, “in particular the 40 million global PowerUp Rewards members, by offering them exclusive, unique and cutting edge merchandise related to their favorite entertainment.”
Geeknet moved into the video game world with the rollout if a new private-label strategy in August with the acquisition of video game manufacturer Treehouse Brand Stores LLC for $1.5 million in cash.
Geeknet is No. 202 in the Internet Retailer 2015 Top 500 Guide,GameStop is No. 58 and Hot Topic is No. 286.
For the first quarter of fiscal 2015 ended March 31, Geeknet reported:
- Net sales declined 15.9% to $19.1 million from $22.7 million in the first quarter of 2013.
- Net loss was $3.9 million compared with $2.2 million.
GameStop did an Internet Retailer-estimated $792 million in online sales in 2014, up by 10% from an estimated $720 million in 2013. The company does not break out online sales, but for the first quarter of fiscal 2015 ended May 2, reported:
- Total sales of $2.060 billion, a 3.2% increase from $1.996 billion in the same period of 2014.
- Net income of $73.8 million, up by 8.5% from $68.0 million in Q1 2014.