GameStop has announced the sale of USD 950 million in notes to investors, which the company will repay in six or seven years, with interest, in a move aimed at financing the firm's forthcoming merger with Electronics Boutique.
The company has offered the sale of USD 650 million in Senior Notes priced at 98.688 percent with an 8 percent fixed rate of interest, and USD 300 million in full priced Senior Floating Rate Notes which will bear interest at the London Inter Bank Offering Rate of 3.875 percent. The Senior Floating Notes will mature on October 1st 2011 and the Senior notes will mature one year later.
The offering is for a strictly limited period and is expected to end by tomorrow. All notes will be redeemed if the merger with Electronics Boutique doesn't close by October 31st.
GameStop announced that EB stockholders would receive USD 1.44 billion in cash and stock when the independent acquisition was first revealed in April this year. The company saw USD 1.84 billion in sales during its last fiscal year and Electronics Boutique achieved USD 1.98 billion sales during its 2005 fiscal year.
According to Reuters, the merger will result in the new GameStop enjoying a twenty five percent share of the market, becoming the largest videogame retailer in the US. The new company would own more than 3,200 US outlets and over 600 stores in Europe and Australasia.