GameStop raised its planned debt notes offering next week to $2.25 billion, which analysts expect would be used to purchase more Bitcoin.
GameStop is about to top up its Bitcoin (BTC) reserves. The American video game retailer and electronics company announced on Thursday evening (EST) that it’s upsizing the allocation for its next debt offering from the previously targeted $1.75 billion to around $2.25 billion.
Reflecting its previous scheme and the tactics of Strategy (formerly MicroStrategy), GameStop’s convertible senior notes are non-interest bearing. The said securities don’t accrue value, but holders can convert them to the company’s stock at a premium closer to maturity on June 15, 2032, unless they are earlier converted, redeemed, or repurchased. The firm only allows “qualified institutional buyers,” as required by the US Securities Act, to participate in the sale.
As added perks for initial purchasers of the notes within 13 days from the date of issuance, GameStop grants them an option to purchase an additional $450 million aggregate principal amount of notes. The business expects to raise between $2.23 billion and $2.68 billion (if the initial purchasers exercise their option to acquire additional notes) during the event, including deductions for discounts, commissions, and other expenses.
ADVERTISEMENTThe video game retailer claimed that it intends to use the proceeds of the notes offering for “general corporate purposes, including making investments in a manner consistent with GameStop’s Investment Policy and potential acquisitions.”
The company’s press release notably didn’t mention anything directly linked to Bitcoin or cryptocurrencies. However, the crypto community and other financial analysts already seem to know where the funds are going.
According to speculations, GameStop will likely allocate a majority of the amount to accumulate more Bitcoin and hedge its treasury assets. This comes amid the existing threats of domestic and global economic instability.
ADVERTISEMENT## Capitalizing on the Market FUD
GameStop is likely preparing for Bitcoin’s upcoming dip, which would give it a good entry point to the asset. Due to the uneasy trade relations between the US and China, further escalated by the tensions between Israel and Iran in the Middle East, several analysts expect BTC’s momentum to continue waning.
If Bitcoin fails to defend its crucial support at $102,000 along the way, there’s a greater risk of it revisiting the $94,000 to $90,000 mark. Additional drops at that point could signal another slide to $78,000.
If timed within the aforementioned $102K-$78K bearish scenarios, GameStop’s $2.25 billion funds could snatch between 22,058 BTC to 28,846 BTC. The massive acquisition could add to its 4,710 BTC reserves, enabling it to surpass the 19,225 BTC treasury of Bitcoin mining powerhouse Riot Platforms and establish itself as the fourth-largest publicly traded company in terms of Bitcoin treasury.
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GameStop To Increase Bitcoin Reserve By $2.25B From Debt Offering This Week
GameStop is about to top up its Bitcoin (BTC) reserves. The American video game retailer and electronics company announced on Thursday evening (EST) that it’s upsizing the allocation for its next debt offering from the previously targeted $1.75 billion to around $2.25 billion.
GameStop’s Upcoming Convertible Senior Notes Offering
Reflecting its previous scheme and the tactics of Strategy (formerly MicroStrategy), GameStop’s convertible senior notes are non-interest bearing. The said securities don’t accrue value, but holders can convert them to the company’s stock at a premium closer to maturity on June 15, 2032, unless they are earlier converted, redeemed, or repurchased. The firm only allows “qualified institutional buyers,” as required by the US Securities Act, to participate in the sale.
As added perks for initial purchasers of the notes within 13 days from the date of issuance, GameStop grants them an option to purchase an additional $450 million aggregate principal amount of notes. The business expects to raise between $2.23 billion and $2.68 billion (if the initial purchasers exercise their option to acquire additional notes) during the event, including deductions for discounts, commissions, and other expenses.
ADVERTISEMENTThe video game retailer claimed that it intends to use the proceeds of the notes offering for “general corporate purposes, including making investments in a manner consistent with GameStop’s Investment Policy and potential acquisitions.”
The company’s press release notably didn’t mention anything directly linked to Bitcoin or cryptocurrencies. However, the crypto community and other financial analysts already seem to know where the funds are going.
According to speculations, GameStop will likely allocate a majority of the amount to accumulate more Bitcoin and hedge its treasury assets. This comes amid the existing threats of domestic and global economic instability.
ADVERTISEMENT## Capitalizing on the Market FUD
GameStop is likely preparing for Bitcoin’s upcoming dip, which would give it a good entry point to the asset. Due to the uneasy trade relations between the US and China, further escalated by the tensions between Israel and Iran in the Middle East, several analysts expect BTC’s momentum to continue waning.
If Bitcoin fails to defend its crucial support at $102,000 along the way, there’s a greater risk of it revisiting the $94,000 to $90,000 mark. Additional drops at that point could signal another slide to $78,000.
If timed within the aforementioned $102K-$78K bearish scenarios, GameStop’s $2.25 billion funds could snatch between 22,058 BTC to 28,846 BTC. The massive acquisition could add to its 4,710 BTC reserves, enabling it to surpass the 19,225 BTC treasury of Bitcoin mining powerhouse Riot Platforms and establish itself as the fourth-largest publicly traded company in terms of Bitcoin treasury.
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