NEWS
NEWS
NEWS
GameStop wins bidding war for ThinkGeek, Hot Topic’s deal is terminated
Despite earlier reports that Hot Topic would be purchasing ThinkGeek, Inc.’s parent company, Geeknet, Inc., for $122 million, that deal has now been terminated and the company’s outstanding shares have been purchased in a surprise bidding war by GameStop Corp. for $140 million.
The Dallas-based game seller recently pulled itself out of an end-of-the-year slump by posting higher-than-expected revenues for its first quarter, and the new ownership of online geek culture retailer ThinkGeek will give GameStop yet another avenue of profit outside out the stagnant physical game sales business.
“This acquisition creates value to all stakeholders involved,” GameStop CEO Paul Raines said in a statement. “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.”
ThinkGeek is best known for its geeky t-shirts and pop culture-themed gadgets and paraphernalia like TARDIS USB hubs and R2-D2 trash cans, and there is some obvious overlap between GameStop’s audience and ThinkGeek’s.
ThinkGeek’s “expanding” product offerings
According to GameStop, its offer “represented a superior proposal” to the one that had been offered by Hot Topic ($18 million superior, to be exact), and Geeknet CEO Kathryn McCarthy said, “Our Board and management team believe this transaction is in the best interest of Geeknet and its stockholders. 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.”
It is unclear in what way exactly ThinkGeek’s offerings will be “expanding,” but an obvious choice would be interactive game collectibles like Nintendo Amiibo, Disney Infinity, Skylanders, and LEGO Dimensions. These products bridge the gap between GameStop’s video game products and ThinkGeek’s collectible products, and GameStop has already shown that it sometimes has trouble meeting the demands of fans for some of these items.
GameStop’s purchase could also open up its game studio partnerships to ThinkGeek, making it easier for the online retailer to sell other game-related products.
Screenshot via ThinkGeek.com
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