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GameStop Tumbles on Plan to Issue Convertible Bonds to Buy Bitcoin
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GameStop ( GME ) shares tumbled in intraday trading Thursday, a day after the video game retailer said it was planning to issue $1.3 billion in convertible bonds for general corporate purposes, including buying Bitcoin ( BTCUSD ).
The company, which earlier this week updated its corporate investment policy to include buying the token, said it is offering the convertible bonds to investors in a private sale. The bonds mature in 2030.
GameStop, a former meme stock darling, is the latest company to use the sale of convertible bonds to load up on Bitcoin. Strategy ( MSTR ), formerly called MicroStrategy, has used the sale of such bonds to become one of the world’s largest holders of the token.
Convertible bonds are corporate bonds that can be changed by the holder into the common stock of the issuing company. GameStop shares are down around 15% Thursday but have gained more than 80% of their value in the past 12 months.
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