GameStop Buys Think Geek in $140 Million Deal
Think Geek was previously in merger discussions with Hot Topic.
Video game retailer GameStop announced on Tuesday that it has acquired Geeknet, the parent company of tech-focused online retailer Think Geek. GameStop will acquire all of Geeknet's outstanding stock (yes, they are a publicly traded company) for $20 per share, meaning the deal is worth an estimated $140 million.
Geeknet was previously in merger discussions with Hot Topic, but those talks have been terminated.
"Following discussion with both GameStop and Hot Topic, the Board of Directors of Geeknet determined that the GameStop transaction represented a superior proposal," GameStop said in a statement. "Geeknet will pay Hot Topic a termination fee pursuant to the Hot Topic agreement, for which GameStop has agreed to reimburse Geeknet."
GameStop CEO Paul Raines offered his own statement on the acquisition, explaining why he thinks it was a smart move that will help GameStop grow its brand.
"This acquisition creates value to all stakeholders involved," he said. "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."
Geeknet's CEO Kathryn McCarthy said, "As a part of GameStop's family of brands, Geeknet will be well-positioned to achieve our goals of increasing our brand awareness and expanding our product offerings."
GameStop added that it expects to see a boost of about $100 million-plus in annual net sales as a result of the buyout. The retailer already sells a lot of game-themed merchandise, making this really an extension--albeit a major one--of what the company already does itself.
Think Geek's video game-themed April Fools' Day prank this year was really, really good.