GameStop Ends Talks for Potential Buyout
posted on by Jennifer Sherman
Game retailer GameStop announced on Tuesday that it is no longer aiming to sell the company because of a “lack of available financing on terms that would be commercially acceptable to a prospective acquirer.”
Wedbush Securities analyst Michael Pachter told entertainment industry news website Variety that he believes GameStop may have found investors, but it may have been unable to find lenders to invest in the company. Pachter said that lenders may see Future Video game streaming services as a threat to the prominence of physical sales that GameStop relies on.
GameStop confirmed on June 19 that it was in talks with third parties "regarding a potential transaction," but noted that it did not guarantee any agreement would result from the talks. The confirmation came after news agency Reuters reported the day before that the company was in talks with private equity firms regarding a buyout.
Former GameStop CEO Michael Mauler recently resigned from his position, three months after taking the position. The company's board of directors appointed company co-founder Daniel DeMatteo as interim chief executive officer.
Source: Variety (Brian Crecente)